Hermosa Beach City Council
September 10, 2024

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-28
Figure D-10: Population of Persons with Disabilities by Tract and Sites Inventory (2021) Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-29
c. Familial Status
Under the Fair Housing Act, housing providers may not discriminate because of familial status. Familial status covers: the presence of children under the age of 18, pregnant persons, any person in the process of securing legal custody of a minor child (including adoptive or foster parents). Examples of familial status discrimination include refusing to rent to families with children, evicting families once a child joins the family through, e.g., birth, adoption, custody, or requiring families with children to live on specific floors or in specific buildings or areas. Single parent households are also protected by fair housing law.

Regional Trend
According to the 2016-2020 ACS, 27.6% of households have children of the householder under age 18. Of the 27.6% of households with children, 18.8% are married couple households, 2.6% are male-headed households, and 6.2% are female-headed households.

Figure D-11 shows households with children in Los Angeles County, Hermosa Beach, and jurisdictions adjacent to Hermosa Beach. Of the selected jurisdictions, Manhattan Beach has the largest proportion of households with children (34.3%), followed by Lawndale (31.9%), and Torrance (29.3%). Hermosa Beach has the smallest proportion of households with children compared to the County and neighboring cities. Lawndale has the largest proportion of single-parent male-headed households. All the selected cities have proportions of single-parent female-headed households below the countywide average of 6.2%.

Figure D-12 shows the population of children living in single-parent female-headed households by tract in the region. Children in female-headed households are most concentrated in the area northeast of Hermosa Beach, including Inglewood, the City of Los Angeles, and unincorporated Los Angeles County communities, and the areas around Long Beach and Lakewood. In general, there are more children living in female-headed households in the central Los Angeles County areas compared to the South Bay, Westside, Gateway, San Fernando Valley, and San Gabriel Valley cities.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-30
Figure D-11: Households with Children in Neighboring Cities and County (2020) Source: 2016-2020 ACS (5-Year Estimates).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-31
Figure D-12: Regional Children in Female-Headed Households by Tract (2019)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-32
Source: HCD AFFH Data Viewer (2015-2019 ACS), 2022.

Local Trend
According to the 2006-2010 and 2016-2020 ACS, the proportion of households with children has increased (Table D-7). Households with children represent 16.4% of households citywide in 2010, but 18.6% in 2020. The proportion of married couples with children and single-parent female-headed households also increased during this period. Femaleheaded households with children require special consideration and assistance because of their greater need for affordable housing and accessible day care, health care, and other supportive services. However, only 2.2% of households in Hermosa Beach are singleparent female-headed households compared to 6.2% countywide. There are no tracts in Hermosa Beach where more than 20% of children reside in female-headed households (Figure D-13). Tract 6211.02 in the southeast section of the City has a smaller population of children in married couple households compared to other tracts. According to the HCD Data Viewer 2.0, based on the 2017-2021 ACS, 64.7% of children reside in married couple households in tract 6211.02 compared to 80.4% to 94.6% of children in the remaining tracts.

Hermosa Beach is characterized by a large population of persons living alone.

Approximately 35% of households are persons living alone in the City compared to only

25.8% countywide. However, 8.9% of households in both the County and City are elderly persons aged 65 and older living alone. Figure D-15 shows that the northern tracts, tracts 6210.01 and 6210.05, have larger populations of adults living alone compared to the southern tracts. According to 2017-2021 ACS estimates, tracts 6210.01 and 6210.05 also have larger populations of elderly adults, 15% and 21.2%, respectively, compared to tracts 6211.02 and 6211.04 in southern Hermosa Beach (14.1% and 8.5%, respectively) (Figure D16).

Table D-7: Households with Children (2010-2020)
Household Type
2010 2020
Households Percent Households Percent
Households with Children 1,542 16.4% 1,595 18.6%
Married Couple with Children 1,314 14.0% 1,310 15.2%
Male Householder with Children 113 1.2% 99 1.2%
Female Householder with Children 115 1.2% 186 2.2%
Total Households 9,389 100.0% 8,596 100.0%
Source: 2006-2010 and 2016-2020 ACS (5-Year Estimates).

Sites Inventory
There are no tracts with populations of children residing in single-parent female-headed households exceeding 20%. The distribution of RHNA units by population of children in married couple households is shown in Figure D-13 and Table D-8. Most RHNA units (78%) are in tracts where more than 80% of children live in married couple households, including

88.5% of lower income units. The City’s RHNA strategy does not concentrate lower or moderate income units in areas where fewer children reside in married couple households.

RHNA sites are distributed throughout tracts with variable populations of children in married

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-33
couple households to the greatest extent possible given the overall character of Hermosa Beach.

Table D-8: Distribution of RHNA Units by Children in Married Couple Households (2021) Children in Married
Couple HHs (Tract)
Lower Income Units Moderate Income
Units
Above Moderate
Income Units Total Units
Units Percent Units Percent Units Percent Units Percent <20% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
20-40% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
40-60% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
60-80% 40 11.5% 65 36.5% 28 38.9% 133 22.2%
>80% 309 88.5% 113 63.5% 44 61.1% 466 77.8%
Total 349 100.0% 178 100.0% 72 100.0% 599 100.0%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-34
Figure D-13: Children in Female-Headed Households by Tract and Sites Inventory (2021) Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-35
Figure D-14: Children in Married Couple Households by Tract and Sites Inventory (2021) Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-36
Figure D-15: Population Living Alone by Tract (2021)
Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-37
Figure D-16: Population Aged 65 and Older by Tract (2021) Source: 2017-2021 ACs (5-Year Estimates).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-38
d. Income
Identifying low or moderate income (LMI) geographies and individuals is important to overcome patterns of segregation. HUD defines a LMI area as a Census tract or block group where over 51% of the population is LMI (based on HUD income definition of up to 80% of the Area Median Income).

Regional Trend
According to Comprehensive Housing Affordability Strategy (CHAS)3 data based on the 2015-2019 ACS, 55.6% of Los Angeles County households are low income, earning 80% or less than the area median income (AMI) (Table D-9). A significantly larger proportion of renter households in Los Angeles County are considered lower income. Over 69% of renter households are lower income compared to only 39.3% of owner households.

Figure D-17 shows populations of low or moderate income (LMI) households in the region by block group. The central and south Los Angeles County areas tend to have larger LMI household populations. Coastal areas, including Hermosa Beach, tend to have smaller populations of low or moderate income households.

Table D-9: Households by Income and Tenure – Los Angeles County (2022) Income Category Owner-Occupied Renter-Occupied Total
0%-30% of AMI 10.8% 30.6% 21.5%
31%-50% of AMI 11.1% 18.9% 15.3%
51%-80% of AMI 17.4% 19.9% 18.7%
81%-100% of AMI 11.0% 8.9% 9.9%
Greater than 100% of AMI 49.7% 21.7% 34.5%
Total 1,519,515 1,797,280 3,316,795
Source: HUD CHAS data (based on 2015-2019 ACS), 2022.
3 Each year, the U.S. Department of Housing and Urban Development (HUD) receives custom tabulations of American Community Survey (ACS) data from the U.S. Census Bureau. These data, known as the "CHAS" data (Comprehensive Housing Affordability Strategy), demonstrate the extent of housing problems and housing needs, particularly for low income households.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-39
Figure D-17: Regional LMI Household Population by Block Group (2020) Source: HCD AFFH Data Viewer (HUD 2020), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-40
Local Trend
A significantly larger proportion of Hermosa Beach households earn 100% or more of the AMI compared to the County as a whole. According to 2022 HUD CHAS data, 71.9% of Hermosa Beach households earn 100% or more of the AMI compared to only 34.5% countywide. The income disparity between owners and renters is also less prominent in Hermosa Beach than the County. Only 22.7% of owners and 21.9% of renters earn less than 80% of the AMI.

According to 2016-2020 ACS estimates, the median household income in Hermosa Beach is $142,500. Coastal cities like Hermosa Beach tend to have significantly higher median household incomes compared to adjacent cities to the east. The median household income in Hermosa Beach is higher than the median in Los Angeles County ($71,358), El Segundo ($115,846), Gardena ($64,015), Lawndale ($65,923), Redondo Beach ($116,832), and Torrance ($94,781), and only slightly lower than the median in Manhattan Beach ($153,926).

Table D-10: Households by Income and Tenure – Hermosa Beach (2022) Income Category Owner-Occupied Renter-Occupied Total
0%-30% of AMI 6.2% 6.7% 6.5%
31%-50% of AMI 7.4% 4.0% 5.6%
51%-80% of AMI 9.1% 11.1% 10.2%
81%-100% of AMI 4.2% 7.4% 5.9%
Greater than 100% of AMI 73.0% 70.8% 71.9%
Total 4,245 4,710 8,955
Source: HUD CHAS data (based on 2015-2019 ACS), 2022.

LMI household populations at the block group-level are shown for Hermosa Beach in Figure D-18. There are no block groups in the City that are considered LMI areas where more than 50% of households are low or moderate income. Most block groups have very small LMI household populations representing less than 25% of the block group population. There are five block groups located along Hermosa Avenue with LMI household populations ranging from 26% to 37%. Populations of LMI households in Hermosa Beach tracts are generally consistent with adjacent coastal cities such as Manhattan Beach and Redondo Beach. As mentioned above, jurisdictions east of the City, including Lawndale, Gardena, and Torrance, have more LMI households.

Sites Inventory
There are no LMI areas where more than 50% of households earn low or moderate incomes in Hermosa Beach. As shown in Table D-11 and Figure D-18. Consistent with the citywide trend, most RHNA units are in block groups where less than 25% of households are low or moderate income. There are 44 lower income units, 20 moderate income units, and 19 above moderate income units in a block group where 35% of households are LMI. The City’s RHNA strategy distributes sites throughout block groups with variable LMI household populations to the extent possible given the composition of Hermosa Beach.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-41
Table D-11: Distribution of RHNA Units by LMI Household Population LMI Households
(Block Group)
Lower Income Units Moderate Income
Units
Above Moderate
Income Units Total Units
Units Percent Units Percent Units Percent Units Percent <25% 305 87.4% 158 88.8% 53 73.6% 516 86.1%
25-50% 44 12.6% 20 11.2% 19 26.4% 83 13.9%
50-75% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
75-100% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
Total 349 100.0% 178 100.0% 72 100.0% 599 100.0%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-42
Figure D-18: LMI Household Population by Block Group and Sites Inventory (2020) Source: HCD AFFH Data Viewer 2.0 (HUD 2020), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-43

3. Racially/Ethnically Concentrated Areas
a. Racially/Ethnically Concentrated Areas of Poverty (R/ECAPs) In an effort to identify racially/ethnically concentrated areas of poverty (R/ECAPs), HUD has identified census tracts with a majority non-White population (greater than 50%) and a poverty rate that exceeds 40% or is three times the average tract poverty rate for the metro/micro area, whichever threshold is lower.

Regional Trend
Figure D-19 shows tracts that have been identified as R/ECAPs or TCAC areas of high segregation and poverty. TCAC opportunity areas and scores are expanded upon in Section 4, Access to Opportunities. In the region, R/ECAPs and areas of high segregation and poverty are most prevalent in the City of Los Angeles, south Los Angeles, and in and around Long Beach. There are no R/ECAPs or areas of high segregation and poverty in the coastal areas stretching from Malibu to Rancho Palos Verdes. As mentioned previously, jurisdictions along the coast tend to have smaller populations of racial/ethnic minorities and LMI households compared to the inland County areas.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-44
Figure D-19: Regional R/ECAPs and TCAC Areas of High Segregation and Poverty Source: HCD AFFH Data Viewer (HUD 2009-2013; TCAC 2022), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-45
Local Trend
There are no R/ECAPs or TCAC-designated areas of high segregation and poverty in Hermosa Beach. The closest R/ECAPs are in the City of Los Angeles and Hawthorne east of the City, and the closest TCAC areas of high segregation and poverty are in the unincorporated County and Inglewood northeast of the City.

As presented in Table D-12, Hermosa Beach has a significantly smaller population below the poverty level compared to the County (4.2% vs. 14.2%, respectively). In Hermosa Beach, the American Indian/Alaska Native population (12.2%) and Asian population (10%) have the highest poverty rates. All other racial/ethnic groups in the City have poverty rates below the citywide average of 4.3%. In Los Angeles County, poverty rates are the highest in the Black/African American population (20.2%), population of some other race (17.8%), Hispanic/Latino population (16.9%), and American Indian/Alaska Native population (16.3%).

Sites Inventory
There are no RHNA sites in R/ECAPs or areas of high segregation and poverty.

Figure D-20 shows poverty status by tract in Hermosa Beach the surrounding area.

Manhattan Beach, Hermosa Beach, and Redondo Beach all contain tracts with small populations of persons below the poverty level. Less than 10% of the population in all Hermosa Beach tracts are below the poverty level. Jurisdictions east of the City, such as Lawndale, Torrance, and Hawthorne, contain tracts with larger populations below the poverty level ranging from 10% to 40%.

Table D-12: Population Below Poverty Level by Race/Ethnicity (2020) Race/Ethnicity
Hermosa Beach Los Angeles County
Total Population % Below
Poverty Level Total Population % Below Poverty Level
Black or African American alone 135 0.0% 787,711 20.2%
American Indian and Alaska Native alone 90 12.2% 76,403 16.3% Asian alone 1,160 10.0% 1,464,802 11.0%
Native Hawaiian and Other Pacific Islander alone 0 -- 24,520 -- Some other race alone 402 2.7% 2,093,575 17.8%
Two or more races 1,789 2.1% 717,876 12.1%
Hispanic or Latino origin (of any race) 2,149 2.7% 4,797,018 16.9% White alone, not Hispanic or Latino 14,358 4.3% 2,554,426 9.4% Total 19,135 4.2% 9,884,138 14.2%
Source: 2016-2020 ACS (5-Year Estimates).

Sites Inventory
There are no RHNA sites in R/ECAPs or areas of high segregation and poverty.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-46
Figure D-20: Poverty Status by Tract (2019)
Source: HCD AFFH Data Viewer (2015-2019 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-47
b. Racially/Ethnically Concentrated Areas of Affluence (RCAAs) While racially concentrated areas of poverty and segregation (R/ECAPs) have long been the focus of fair housing policies, racially concentrated areas of affluence (RCAAs) must also be analyzed to ensure housing is integrated, a key to fair housing choice. According to a policy paper published by HUD, RCAAs are defined as communities with a large proportion of affluent and non-Hispanic White residents. According to HUD's policy paper, non-Hispanic Whites are the most racially segregated group in the United States. In the same way neighborhood disadvantage is associated with concentrated poverty and high concentrations of people of color, conversely, distinct advantages are associated with residence in affluent, White communities.

HCD has created a new version of the RCAA metric to better reflect California's relative diversity and regional conditions, and to aid local jurisdictions in their analysis of racially concentrated areas of poverty and affluence pursuant to AB 686 and AB 1304. This section describes RCAAs using HCD’s updated methodology.4
Regional Trend
As presented in Figure D-21, RCAAs are more prevalent in Los Angeles County coastal communities. In the region surrounding Hermosa Beach, RCAAs have been identified along the coast from Malibu to Ranchos Palos Verdes. There are no RCAAs in the central, south, and east Los Angeles area. As shown in Figure D-5 and Figure D-17 previously, coastal areas tend to have smaller non-White and LMI household populations compared to inland jurisdictions.

Figure D-22 shows median income by block group in the region. Consistent with the RCAA trend, block groups with higher median incomes exceeding the Statewide median of $87,100 are most prevalent along the coast from Santa Monica to Ranchos Palos Verdes.

In general, median incomes are lower the more inland a jurisdiction is. Most block groups in central and east Los Angeles surrounding the City of Los Angeles have median incomes below the State median.
4 HCD, Racially Concentrated Areas of Affluence. Summary and Description. Accessed January 20, 2023. https://www.arcgis.com/home/item.html?id=4100330678564ad699d139b1c193ef14&sublayer=4.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-48
Figure D-21: Regional RCAA Tracts (2019)
Source: HCD AFFH Data Viewer (2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-49
Figure D-22: Regional Median Income by Block Group (2019) Source: HCD AFFH Data Viewer (2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-50
Local Trend
Median household income by race/ethnicity in Hermosa Beach and Los Angeles County is shown in Table D-13. In the County, White, non-Hispanic households have the highest median income of $91,323. Black/African American households ($51,256), households of some other race ($56,747), and Hispanic/Latino households ($59,837) have the lowest median incomes in the County. American Indian/Alaska Native households also have a median income below the countywide median of $71,358.

The median household income in Hermosa Beach is $142,500, significantly higher than the median countywide. The median income amongst Black/African American households in Hermosa Beach is well below other racial/ethnic groups but is higher than the median for Black/African American households countywide. The median household income for the Black/African American population is only $86,056. The median household income in the Hispanic Latino population, $139,034, is also lower than the citywide median of $142,083.

All other racial/ethnic groups in the City have median household incomes exceeding the median citywide.

Table D-13: Median Household Income by Race/Ethnicity (2020) Race/Ethnicity
Hermosa Beach Los Angeles County
% Distribution Median HH
Income % Distribution Median HH Income
Black or African American 1.0% $86,056 9.4% $51,259
American Indian and Alaska Native 0.7% - 0.7% $62,427
Asian 4.7% $212,847 15.1% $83,252
Native Hawaiian and Other Pacific Islander 0.0% - 0.2% $78,831 Some other race 1.2% $152,656 16.1% $56,747
Two or more races 4.5% $206,875 5.8% $71,943
Hispanic or Latino origin (of any race) 7.3% $139,034 37.7% $59,837 White alone, not Hispanic or Latino 82.6% $143,083 35.1% $91,323 Total 8,596 $142,500 3,332,504 $71,358
Source: 2016-2020 ACS (5-Year Estimates).

All tracts in Hermosa Beach are considered RCAAs (Figure D-24). As presented in Figure D24, most block groups in the City have median incomes exceeding the State median of $87,100. There is one block group with a median income of only $54,150 located in the northwestern section of the City. This block group encompasses North School and Valley Park and is located along Valley Drive, Gould Avenue, 27th Street, and Hermosa Avenue.

The tract encompassing this block group has a larger proportion of renter-occupied households compared to all other City tracts. Approximately 61% of households in this tract are renters. In general, renters are more likely to have lower incomes compared to owners.

Tenure is further discussed in Section 5, Disproportionate Housing Needs, of this Assessment of Fair Housing Issues.

Block groups between Hermosa Avenue and Ardmore Avenue, including the block group discussed above, tend to have lower median incomes than the remainder of the City.

There is one mobile home park in Hermosa Beach on Pier Avenue in this section of the City (Marineland MHP, 60 units). Mobile homes tend to be more affordable than other housing options; therefore, households residing in mobile homes generally have lower incomes.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-51
Hermosa Beach was previously a redlined community. The Home Owners’ Loan Corporation (HOLC) was created in the New Deal Era and trained many home appraisers in the 1930s. The HOLC created a neighborhood ranking system infamously known today as redlining. Local real estate developers and appraisers in over 200 cities assigned grades to residential neighborhoods. These maps and neighborhood ratings set the rules for decades of real estate practices. The grades ranged from A to D. During this time period, Hermosa Beach was ranked D. A D-ranking was considered “hazardous” and “areas here often received this grade because they were "infiltrated" with "undesirable populations" such as Jewish, Asian, Mexican, and Black families. These areas were more likely to be close to industrial areas and to have older housing.”5 Despite being historically redlined, Hermosa Beach has gradually transitioned into a desirable community given its coastal location,
Hermosa Beach is a coastal community spanning only approximately a mile inland.

Because of the geographic character of the City, land and housing costs, including rental and ownership housing, tend to be higher compared to other Los Angeles County jurisdictions. According to Zillow’s market summary for Hermosa Beach, the median rent in the City is $5,900 as of November 2023.6 Manhattan Beach and Redondo Beach, coastal cities north and south of Hermosa Beach also have higher median rental prices of $7,000 and $3,500, respectively, compared to jurisdictions east of the City including Torrance ($2,733), Lawndale ($2,600), and the City of Los Angeles ($2,800). Similarly, the median home sale price in Hermosa Beach in August 2022 was $1,850,000 compared to only $820,000 countywide during the same period.7 Manhattan Beach and Redondo Beach also had median home sale prices exceeding the County average of $2,842,500 and $1,300,000, respectively. Cities just inland of Hermosa Beach had significantly lower median home sale prices, including Torrance ($956,500), Lawndale ($855,00), Gardena ($730,000), and the City of Los Angeles ($1,075,000). The high housing costs in the City, due to geographic location, are a contributing factor for the prevalence in RCAAs in the community.

Actions outlined in this Housing Element (see Table II-2 in Chapter II, Housing Policy Plan) aim to increase access to these RCAAs through increased housing opportunities and outreach strategies. Affirmative marketing strategies include working with agencies serving low income and special needs households to promote affordable housing opportunities in the City to promote more diverse and inclusive communities.

Sites Inventory
All sites identified to meet the RHNA are in RCAAs.
5 HCD AFFH Data Viewer 2.0, HOLC Redlining Grade Description. https://www.arcgis.com/home/item.html?id=7792ea4a90834c168078907350c40ad8. Accessed November 2023.
6 Zillow.com Rental Market Trends. https://www.zillow.com/rental-manager/market-trends/. Accessed November 2023.
7 Corelogic California Home Sale Activity by City, August 2022. https://www.corelogic.com/wpcontent/uploads/sites/4/2022/09/CA-Home-Sale-Activity-by-City-August-2022.pdf.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-52
Figure D-23: RCAA Tracts (2019)
Source: HCD AFFH Data Viewer (2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-53
Figure D-24: Median Income by Block Group (2019)
Source: HCD AFFH Data Viewer (2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-54

4. Access to Opportunities
Significant disparities in access to opportunity are defined by the AFFH Final Rule as “substantial and measurable differences in access to educational, transportation, economic, and other opportunities in a community based on protected class related to housing.”
The Department of Housing and Community Development (HCD) and California Tax Credit Allocation Committee (TCAC) convened the California Fair Housing Task force to “provide research, evidence-based policy recommendations, and other strategic recommendations to HCD and other related state agencies/ departments to further the fair housing goals (as defined by HCD).” The Task Force has created Opportunity Maps to identify resources levels across the state “to accompany new policies aimed at increasing access to high opportunity areas for families with children in housing financed with nine percent Low Income Housing Tax Credits (LIHTCs)”. These opportunity maps are made from composite scores of three different domains made up of a set of indicators. Table D-14 shows the full list of indicators. The opportunity maps include a measure or “filter” to identify areas with poverty and racial segregation. To identify these areas, census tracts were first filtered by poverty and then by a measure of racial segregation. The criteria for these filters were:
• Poverty: Tracts with at least 30 percent of population under federal poverty line; • Racial Segregation: Tracts with location quotient higher than 1.25 for Blacks, Hispanics, Asians, or all people of color in comparison to the County Table D-14: Domains and List of Indicators for Opportunity Maps Domain Indicator
Economic Poverty
Adult education
Employment
Job proximity
Median home value
Education Math proficiency
Reading proficiency
High School graduation rates
Student poverty rates
Environmental CalEnviroScreen 3.0 pollution Indicators and values Source: California Fair Housing Task Force, Methodology for the 2021 TCAC/HCD Opportunity Maps, December 2020.

TCAC/HCD assigns “scores” for each of the domain (see Table D-14) by census tracts as well as computing “composite” scores that are a combination of the three domains.

Scores from each individual domain range from 0-1, where higher scores indicate higher “access” to the domain or higher “outcomes.” Composite scores do not have a numerical value but rather rank census tracts by the level of resources (low, moderate, high, highest, and high poverty and segregation).

The TCAC/HCD Opportunity Maps offer a tool to visualize show areas of highest resource, high resource, moderate resource, moderate resource (rapidly changing), low resource, and high segregation and poverty and can help to identify areas within the community

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-55
that provide good access to opportunity for residents or, conversely, provide low access to opportunity. They can also help to highlight areas where there are high levels of segregation and poverty.

The information from the opportunity mapping can help to highlight the need for housing element policies and programs that would help to remediate conditions in low resource areas and areas of high segregation and poverty and to encourage better access for low and moderate income and black, indigenous, and people of color (BIPOC) households to housing in high resource areas.

Regional Trend
As explained previously, TCAC composite scores categorize the level of resources in each census tract. Categorization is based on percentile rankings for census tracts within the region. In the Los Angeles County region surrounding Hermosa Beach, coastal areas are predominantly highest resource areas (Figure D-25). As tracts go further inland, the lower composite TCAC scores are. The central and south Los Angeles areas are predominantly low resource areas and areas of high segregation and poverty. Jurisdictions adjacent to Hermosa Beach to the east, including Lawndale and Gardena, are comprised of high, moderate, and low resource areas, whereas cities even further east of Hermosa Beach, such as the City of Los Angeles, Willowbrook and Westmont communities, and Compton, have primarily low resource areas and areas of high segregation and poverty.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-56
Figure D-25: Regional TCAC Opportunity Area Scores by Tract (2022) Source: HCD AFFH Data Viewer (TCAC 2022), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-57
While the Federal Affirmatively Furthering Fair Housing (AFFH) Rule has been repealed, the data and mapping developed by HUD for the purpose of preparing the Assessment of Fair Housing (AFH) can still be useful in informing communities about segregation in their jurisdiction and region, as well as disparities in access to opportunity. This section presents the HUD-developed index scores based on nationally available data sources to assess County residents’ access to key opportunity assets. HUD opportunity indices are provided for entitlement jurisdictions only. Opportunity indicators are not available for the City of Corte Madera. Table D-20 provides index scores or values (the values range from 0 to 100) for the following opportunity indicator indices:
• School Proficiency Index: The school proficiency index uses school-level data on the performance of 4th grade students on state exams to describe which neighborhoods have high-performing elementary schools nearby and which are near lower performing elementary schools. The higher the index value, the higher the school system quality is in a neighborhood.
• Labor Market Engagement Index: The labor market engagement index provides a summary description of the relative intensity of labor market engagement and human capital in a neighborhood. This is based upon the level of employment, labor force participation, and educational attainment in a census tract. The higher the index value, the higher the labor force participation and human capital in a neighborhood.
• Transit Trips Index: This index is based on estimates of transit trips taken by a family that meets the following description: a 3-person single-parent family with income at 50 percent of the median income for renters for the region (i.e., the Core-Based Statistical Area (CBSA). The higher the transit trips index value, the more likely residents in that neighborhood utilize public transit. • Low Transportation Cost Index: This index is based on estimates of transportation costs for a family that meets the following description: a 3-person single-parent family with income at 50 percent of the median income for renters for the region/CBSA. The higher the index value, the lower the cost of transportation in that neighborhood.
• Jobs Proximity Index: The jobs proximity index quantifies the accessibility of a given residential neighborhood as a function of its distance to all job locations within a region/CBSA, with larger employment centers weighted more heavily.

The higher the index value, the better the access to employment opportunities for residents in a neighborhood.
• Environmental Health Index: The environmental health index summarizes potential exposure to harmful toxins at a neighborhood level. The higher the index value, the less exposure to toxins harmful to human health. Therefore, the higher the index value, the better the environmental quality of a neighborhood, where a neighborhood is a census block-group.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-58
Table D-15: Opportunity Indices by Race/Ethnicity – Los Angeles County (2020) School
Proficiency Index
Labor Market
Index Transit Trip Index
Low
Transportation
Cost Index
Jobs Proximity
Index
Environmental
Health Index
Total Population
White, non-Hispanic 65.09 65.41 82.63 74.09 55.80 18.99 Black, non-Hispanic 32.37 34.00 87.70 79.18 40.13 11.66 Hispanic 38.38 33.18 87.19 77.74 41.53 11.91
Asian/Pacific Islander, non-Hispanic 59.34 55.94 86.52 76.45 51.82 12.16 Native American, non-Hispanic 46.90 44.50 83.17 75.65 44.24 16.74 Population below federal poverty line
White, non-Hispanic 58.06 57.49 86.42 79.48 57.52 16.66 Black, non-Hispanic 27.16 25.52 88.65 81.18 36.59 11.62 Hispanic 32.87 27.66 89.45 81.02 42.84 10.30
Asian/Pacific Islander, non-Hispanic 54.52 50.06 89.62 81.49 54.19 9.84 Native American, non-Hispanic 35.12 32.02 85.23 78.70 46.35 16.01 Source: AFFHT Data Table 12; Data Sources: Decennial Census; ACS; Great Schools; Common Core of Data; SABINS; LAI; LEHD; NATA.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-59
Local Trend
Table D-16 and Sites Inventory
All RHNA sites are in HCD/TCAC highest resource areas.

Figure D-26 show TCAC opportunity map scores by tract in Hermosa Beach. All tracts in the City are considered highest resource areas. As mentioned above, jurisdictions adjacent to Hermosa Beach, such as Manhattan Beach, Redondo Beach, are also comprised of mostly highest resource tracts. Tract 6211.02 in the southeast corner of the City has the lowest economic, environmental, and composite scores compared to other tracts in Hermosa Beach. However, all scores in all Hermosa Beach tracts are high, revealing economic, environmental, and educational opportunities are highly accessible in the City.

Table D-16: TCAC Opportunity Map Scores by Tract (2021) Tract Economic Score Environmental
Score Education Score Composite Score Final Category
6210.01 0.96 0.95 1.00 1.29 Highest Resource
6210.02 1.00 0.97 1.00 1.54 Highest Resource
6210.04 0.98 0.96 1.00 1.38 Highest Resource
6211.02 0.93 0.90 0.98 1.09 Highest Resource
6211.04 0.99 0.94 0.98 1.30 Highest Resource
Source: TCAC/HCD Opportunity Map Scores by Tract, 2021.

Sites Inventory
All RHNA sites are in HCD/TCAC highest resource areas.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-60
Figure D-26: TCAC Opportunity Area Scores by Tract (2022) Source: HCD AFFH Data Viewer (TCAC 2022), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-61
a. Economic
Regional Trend
As of December 2022, Los Angeles County has a labor force of 4,927,700 with an unemployment rate of 4.4%.8 According to the 2016-2020 ACS, the following industries employ the largest proportions of Los Angeles County residents: educational services, and health care and social assistance (19.5%), professional, scientific, and management, and administrative and waste management services (14%), and manufacturing (10.9%). The California Employment Development Department (EDD) cited the following companies and organizations as major employers in Los Angeles County:
• AHMC Healthcare Inc (Alhambra) – 5,000 to 9,999 employees • All Nations Church (Sylmar) – 1,000 to 4,999 employees • California State Univ NRTHRDG (Northridge) – 1,000 to 4,999 employees • Cedars-Sinai Health System (West Hollywood) – 10,000+ employees • Infineon Technologies Americas (El Segundo) – 1,000 to 4,999 employees • Kaiser Permanente Los Angeles (Los Angeles) – 5,000 to 9,999 employees • Lac & USC Medical Ctr (Los Angeles) – 5,000 to 9,999 employees • Long Beach City Hall (Long Beach) – 5,000 to 9,999 employees • Longshore Dispatch (Wilmington) – 5,000 to 9,999 employees • Los Angeles County Sheriff (Monterey Park) – 10,000+ employees • Los Angeles Intl Airport-Lax (Los Angeles) – 10,000+ employees • Los Angeles Medical Ctr (Los Angeles) – 5,000 to 9,999 employees • Los Angeles Police Dept (Los Angeles) – 5,000 to 9,999 employees • National Institutes of Health (Pasadena) – 10,000+ employees • Security Industry Specialist (Culver City) – 1,000 to 4,999 employees • Six Flags (Valencia – 5,000 to 9,999 employees
• Sony Pictures Entrtn Inc (Culver City) – 5,000 to 9,999 employees • Space Exploration Tech Corp (Hawthorne) – 5,000 to 9,999 employees • Twentieth Century Fox (Los Angeles) – 5,000 to 9,999 employees • UCLA Community Based Learning (Los Angeles) – 10,000+ employees • University of Ca Los Angeles (Los Angeles) – 10,000+ employees • Vision X (Los Angeles) – 10,000+ employees
• Walt Disney Co (Burbank) – 5,000 to 9,999 employees
8 California Employment Development Department (EDD). 2023. Los Angeles County Profile.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-62
• Water Garden Management (Santa Monica) – 1,000 to 4,999 employees HUD’s opportunity indicators provide values for labor market index9 and jobs proximity index10 that can be measures for economic development in Los Angeles County. Like the other HUD opportunity indicators, scores range from 0 to 100 and are published by race and poverty level to identify differences in the relevant “opportunity” (in this case economic opportunity). The labor market index value is based on the level of employment, labor force participation, and educational attainment in a census tract- a higher score means higher labor force participation and human capital in a neighborhood. Los Angeles County’s labor market index values have range significantly from 33 to 65, with Hispanic residents scoring lowest and White residents scoring highest. Scores for Los Angeles County residents living below the poverty line drop for all racial/ethnic groups, most notably for Native American residents (from 45 to 32). Index values indicate that Black and Hispanic residents living in poverty have the lowest labor force participation and human capital in the County.

HUD’s jobs proximity index quantifies the accessibility of a neighborhood to jobs in the region. Index values can range from 0 to 100 and a higher index value indicate better the access to employment opportunities for residents in a neighborhood. County jobs proximity index values range from 40 to 56 for the total population, where the White population scores the highest and the Black population scores the lowest. The jobs proximity value map in Figure D-27 shows the distribution of scores by block group in the region surrounding Hermosa Beach. Jobs proximity scores are highest in block groups in the Westside area, El Segundo, Manhattan Beach, Downtown Los Angeles, and Torrance.

Block groups with low scores below 20 are most concentrated in the south Los Angeles area (i.e., Inglewood, South Gate, Compton), the Palos Verdes Peninsula, and Long Beach.

The TCAC Economic Scores are a composite of jobs proximity index values as well as poverty, adult education, employment, and median home value characteristics. TCAC economic scores range from 0 to 1, where higher values indicate more positive economic outcomes. The map in Figure D-28 shows that tracts with the lowest economic scores are located east of Hermosa Beach and other coastal cities, including tracts in and around the cities of Compton, Huntington Park, the City of Los Angeles, Wilmington, and Long Beach. Nearly all tracts in jurisdictions in the coastal areas (i.e., Santa Monica, Hermosa Beach, Redondo Beach, Rancho Palos Verdes) scored in the highest quartile for economic opportunities.
9 Labor Market Engagement Index: The labor market engagement index provides a summary description of the relative intensity of labor market engagement and human capital in a neighborhood. This is based upon the level of employment, labor force participation, and educational attainment in a census tract. The higher the score, the higher the labor force participation and human capital in a neighborhood. 10 Jobs Proximity Index: The jobs proximity index quantifies the accessibility of a given residential neighborhood as a function of its distance to all job locations within a region/CBSA, with larger employment centers weighted more heavily. The higher the index value, the better the access to employment opportunities for residents in a neighborhood.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-63
Figure D-27: Regional Jobs Proximity Index Scores by Block Group (2017)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-64
Source: HCD AFFH Data Viewer (HUD, 2014-2017), 2022.

Figure D-28: Regional TCAC Economic Scores by Tract (2022)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-65
Source: HCD AFFH Data Viewer (TCAC 2022), 2022.

Local Trend
According to the 2016-2020 ACS, Hermosa Beach has a labor force of 11,935 persons with an unemployment rate of 3.9%. The ACS estimates Los Angeles County had an unemployment rate of 6.5% during the same period. The following industries employ the largest proportions of Hermosa Beach residents: professional, scientific, and management, and administrative and waste management services (24.2%), educational services, and health care and social assistance (14.6%), finance and insurance, and real estate and rental and leasing (13.5%), and manufacturing (12.4%).

As shown in Figure D-29, approximately 76% of employees in Hermosa Beach commute to work in a car, truck, or van compared to 81.6% countywide. A significantly larger proportion of employees work from home in Hermosa Beach (16.3%) compared to the County (8%). Overall, Hermosa Beach residents tend to have slightly longer commutes compared to residents countywide. Over 34% of workers in Hermosa Beach commute 45 minutes or longer to work compared to only 25% of workers in Los Angeles County.

Figure D-29: Means of Transportation to Work (2020)
Source: 2016-2020 ACS (5-Year Estimate).

Jobs proximity scores by block group are shown for Hermosa Beach in Figure D-30. In general, block groups on the northern side of the City have higher jobs proximity scores compared to the southern side. Block groups on the northern side and along the western border received scores ranging from 61 to 75, while block groups on the southern side received scores ranging from 49 to 58. While the northern section of the City has slightly better access to employment opportunities, jobs proximity scores citywide are generally comparable.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-66
All tracts in the City scored in the highest quartile for TCAC economic opportunities (Figure D-31).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-67
Figure D-30: Jobs Proximity Index Scores by Block Group (2017) Source: HCD AFFH Data Viewer (HUD, 2014-2017), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-68
Figure D-31: TCAC Economic Scores by Tract (2022)
Source: HCD AFFH Data Viewer (TCAC 2022), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-69
b. Education
Regional Trend
The school proficiency index is an indicator of school system quality, with higher index scores indicating access to higher school quality. In Los Angeles County, Black residents have access to lower quality schools (lowest index value of 32), followed by Hispanic residents (38), and Native American residents (47). The White and Asian/Pacific Islander populations received higher index scores of 59 and 65, respectively (Table D-15). For residents living below the federal poverty line, index values are lower for all races and are still lowest for Black and Hispanic residents. White residents have the highest index values, indicating a greater access to high quality schools, regardless of poverty status.

The HCD/TCAC education scores for the region show the distribution of education quality based on education outcomes (Figure D-32). As explained in Table D-14, the Education domain score is based on a variety of indicators including math proficiency, reading proficiency, high school graduation rates, and student poverty rates. The education scores range from 0 to 1, with higher scores indicating more positive education outcomes. In the region, lower education scores are found in census tracts in the Downtown Los Angeles and south Los Angeles areas, such as the City of Los Angeles, Inglewood, Westmont, and Huntington Park, and Long Beach area. Consistent with TCAC composite scores, tracts in coastal areas, from Santa Monica to Rancho Palos Verdes, have higher education scores, most scoring in the highest quartile.

As of 2022, Los Angeles County had a five-year cohort graduation rate of 86.1%, slightly lower than 86.1% statewide.11 The Asian and Filipino populations have the highest graduation rates (both 95.8%), followed by the White population (89.3%), and population of two or more races (86.9%). The American Indian and African American populations have the lowest graduation rates (67.2% and 78.5%, respectively). In the 2019-2020 school year, 61.5% of high school completers were enrolled in college in Los Angeles County compared to 62.7% in the State.
11 California Department of Education (CDE), Data Quest. 2021-2022 Five-Year Cohort Graduation Rate, Los Angeles County Report. Accessed January 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-70
Figure D-32: Regional TCAC Education Scores by Tract (2022) Source: HCD AFFH Data Viewer (TCAC 2022), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-71
Local Trend
The Hermosa Beach City School District operates in the City and includes Hermosa View School (TK-2), Hermosa Vista School (3-4), and Hermosa Valley School (5-8). There is no public high school in Hermosa Beach. The closest public high schools are located in Manhattan Beach and Redondo Beach.

Greatschools.org is a non-profit organization that rates schools across the States. The Great Schools Summary Rating calculation is based on four ratings: the Student Progress Rating or Academic Progress Rating, College Readiness Rating, Equity Rating, and Test Score Rating. Ratings at the lower end of the scale (1-4) signal that the school is “below average”, 5-6 indicate “average”, and 7-10 are “above average.” Hermosa View School and Hermosa Valley School received high scores of 10 and 9, respectively.

The Healthy Places Index (HPI) is a new tool that allows local officials to diagnose and change community conditions that affect health outcomes and the wellbeing of residents.12 The HPI tool was developed by the Public Health Alliance of Southern California to assist in comparing community conditions across the state and combined 25 community characteristics such as housing, education, economic, and social factors into a single indexed HPI Percentile Score. Hermosa Beach has an HPI index score in 96th percentile, indicating the City has healthier community conditions than 96% of other California cities and towns. The HPI also includes individual indicators related to variables including, but not limited to, economic, educational, social, environmental, and housing factors. Educational variables include population with a bachelor’s education or higher, high school enrollment, and preschool enrollment at the tract level. All Hermosa Beach tracts scored in the highest quartile for population with a bachelor’s education or higher.

More than 71% of the population over the age of 25 in all tracts have a bachelor's degree of higher. In all Hermosa Beach tracts, 100% of 15 to 17 year olds are also enrolled in high school. Preschool enrollment is also included as a variable for the HPI as “early childhood is a crucial period for brain development, shaping nearly every aspect of one’s future health and wellbeing. Quality preschool is important for healthy development, and has been associated with lifelong educational, economic and health benefits.”13 Figure D-33 shows percentile rankings by tract for preschool enrollment in Hermosa Beach. The northern Hermosa Beach tracts scored in the highest quartile for preschool enrollment, where 75% to 100% of 3 and 4 year olds are enrolled in preschool. Only 53.8% of preschoolaged children in the southeastern tract (tract 6211.02) and 50.9% in the southwestern tract (tract 6211.04) are enrolled in preschool.

TCAC education scores for Hermosa Beach tracts are presented in Figure D-34. As stated in Table D-14 above, TCAC education scores are formulated based on math proficiency, reading proficiency, high school graduation rates, and student poverty rates. All tracts in the City scored in the highest quartile for educational opportunities. 12 California Healthy Places Index (HPI) (based on ACS 2015-2019 (5-Year Estimates)), 2022. Accessed January 2023. https://www.healthyplacesindex.org/. 13 California Healthy Places Index (HPI), 2022. Preschool Enrollment. Accessed January 2023. https://policies.healthyplacesindex.org/education/preschool-enrollment/about.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-72
Figure D-33: Healthy Places Index – Preschool Enrollment by Tract (2019) Source: California Healthy Places Index (HPI) (based on 2015-2019 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-73
Figure D-34: TCAC Education Scores by Tract (2022)
Source: HCD AFFH Data Viewer (TCAC 2022), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-74
c. Environmental
Regional Trend
Historical and current land uses, such as landfills and proximity to freeways, may expose residents to variable environmental conditions. The TCAC Environmental Score shown in Figure D-35 is based on CalEnviroScreen 3.0 scores. The California Office of Environmental Health Hazard Assessment (OEHHA) compiles these scores to help identify California communities disproportionately burdened by multiple sources of pollution. In addition to environmental factors (pollutant exposure, groundwater threats, toxic sites, and hazardous materials exposure) and sensitive receptors (seniors, children, persons with asthma, and low birth weight infants), CalEnviroScreen also takes into consideration socioeconomic factors. These factors include educational attainment, linguistic isolation, poverty, and unemployment. TCAC Environmental Scores range from 0 to 1, where higher scores indicate a more positive environmental outcome (better environmental quality) A large proportion of the region surrounding Hermosa Beach is comprised of tracts scoring in the lowest quartile for environmental opportunities (Figure D-35). Most tracts in and around the cities of Los Angeles, El Segundo, Gardena, Carson, Long Beach, Compton, and South Gate received environmental scores in the lowest quartile. Hermosa Beach, Redondo Beach, and the Palos Verdes peninsula (Rolling Hills Estates, Rancho Palos Verdes, Palos Verdes Estates) have the highest concentration of tracts scoring in the highest quartile in the region. Most of Los Angeles County as a whole received environmental scores of 0.5 or lower.

Figure D-35 shows the TCAC Environmental Score based on CalEnviroScreen 3.0. However, the Office of Environmental Health Hazard Assessment has released updated scored in February 2020 (CalEnviroScreen 4.0). The CalEnviroScreen 4.0 scores in Figure D-36 are based on percentiles and show that coastal areas, from Santa Monica to Rancho Palos Verdes, generally have better environmental conditions compared to south, central, and east Los Angeles. Tracts scoring in the 91st percentile or higher (worst scores) are prevalent in the section of the County stretching from Glendale to Carson (north and south) and Inglewood to El Monte (west and east).

HUD’s opportunity index for “environmental health” summarizes potential exposure to harmful toxins at a neighborhood level. Index values range from 0 to 100 and the higher the index value, the less exposure to toxins harmful to human health. Therefore, the higher the value, the better the environmental quality of a neighborhood, where a neighborhood is a census block-group. In Los Angeles County, environmental health index values range from 11.7 for Black residents to 19 for White residents for the total population (Table D-15).

The index decreases for all racial/ethnic groups below the poverty line, most drastically for the Asian/Pacific Islander population. Of the populations below the poverty line, Asian/Pacific Islander residents have the lowest environmental health index score of 9.8.

The White population, including the population below the poverty line, has the highest environmental health index score compared to other racial/ethnic groups.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-75
Figure D-35: Regional TCAC Environmental Scores by Tract (2022)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-76
Source: HCD AFFH Data Viewer (TCAC 2022), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-77
Figure D-36: Regional CalEnviroScreen 4.0 Percentile Scores by Tract (2021) Source: HCD AFFH Data Viewer (OEHHA 2021), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-78
Local Trend
TCAC environmental scores by tract are shown in Figure D-38 for Hermosa Beach. Of the five tracts in the City, four scored in the highest quartile and one, in the southwestern corner of the City, received a score of 0.74. While this tract did receive a slightly lower environmental score compared to the remainder of Hermosa Beach, it is relevant to note that the other four tracts received scores ranging from 0.75 to 0.83. Based on these scores, environmental opportunities, based on TCAC/HCD’s definition, are generally consistent citywide.

CalEnviroScreen 4.0 scores for Hermosa Beach are presented in Figure D-39. Consistent with TCAC environmental scores, all tracts in the City received low CalEnviroScreen 4.0 percentile scores (best scores) indicating healthy environmental conditions.

As mentioned above, based on the overall HPI score, Hermosa Beach has healthier community conditions than 96% of other California cities and towns. The HPI includes individual indicators used to determine a City or neighborhoods overall score. The HPI uses the following variables to analyze clean environment: Diesel PM (average daily amount of particulate pollution (very small particles) from diesel sources, measured in kilograms/day), drinking water contaminants (combines information about 13 contaminants and 2 types of water quality violations that are sometimes found when drinking water samples are tested), ozone (average amount of ozone in the air during the most polluted 8 hours of summer days, measured in parts per million), and PM 2.5 (yearly average of fine particulate matter concentration (very small particles from vehicle tailpipes, tires and brakes, powerplants, factories, burning wood, construction dust, and many other sources), measured in micrograms/meter3). All Hermosa Beach tracts scored in the highest quartile (best scores) for drinking water contaminants and in the 72nd percentile for ozone. All tracts also scored in the lowest quartile for PM 2.5 Diesel PM percentile rankings by tract are shown in Figure D-37. Most tracts received percentile scores for Diesel PM ranging from 32 to 50, while the northeastern tract scored in the 18th percentile. While the City does have low scores for Diesel PM and PM 2.5, these scores are generally consistent with the County as a whole. Coastal cities, such as Hermosa Beach, generally have slightly better Diesel PM and PM 2.5 percentile scores compared to inland County jurisdictions. High levels of Diesel PM are typically recorded adjacent to ports, rail yards, and freeways.14 PM 2.5 emissions are typically emitted from power plants, industries, and automobiles, but can also be emitted by construction sites, unpaved roads, fields, smokestacks, for fires.15 Highly urbanized areas such as Los Angeles County, including Hermosa Beach, are generally more exposed to high Diesel PM and PM 2.5 pollutants.

The HPI also includes data for park access. Parks and open space are an important part of environmental health as “parks can encourage physical activity, reduce chronic diseases, improve mental health, foster community connections, and support community resilience to climate change and pollution.”16 According to the HPI based on 2017 14 California Office of Environmental Health Hazard Assessment (OEHHA), Diesel Particulate Matter. Accessed January 2023. https://oehha.ca.gov/calenviroscreen/indicator/diesel-particulatematter#:~:text=What%20is%20diesel%20particulate%20matter,contains%20hundreds%20of%20different%20chemical s..
15 United States Environmental Protection Agency (EPA), Particulate Matter (PM) Basics. Accessed January 2023. https://www.epa.gov/pm-pollution/particulate-matter-pm-basics. 16 California Healthy Places Index (HPI). Policy Guide, Park Access. Accessed January 2023. https://policies.healthyplacesindex.org/neighborhood/park-access/about.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-79
California Department of Public Health data, 100% of residents in all Hermosa Beach tracts live within a half-mile of a park, beach, or open space.

Sites Inventory
All RHNA units are located in tracts scoring within the 20th percentile (best scores) of CalEnviroScreen 4.0 scores.

Figure D-37: Healthy Places Index – Diesel PM by Tract (2016) Source: California Healthy Places Index (HPI) (based on CalEnviroScreen 4.0, 2016), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-80
Figure D-38: TCAC Environmental Scores by Tract (2022)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-81
Source: HCD AFFH Data Viewer (TCAC 2022), 2023.

Figure D-39: CalEnviroScreen 4.0 Percentile Scores by Tract (2021)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-82
Source: HCD AFFH Data Viewer 2.0 (OEHHA 2021), 2023.
d. Transportation
Regional Trend
HUD’s opportunity indicators can provide a picture of transit use and access in Marin County through the transit index 17 and low transportation cost.18 Index values can range from zero to 100 and are reported per race so that differences in access to transportation can be evaluated based on race. In the County, transit index values range from 82.6 to

87.7, where White residents scored the lowest and Black residents scored the highest.

Hispanic (87.2) and Asian/Pacific Islander (86.5) populations also scored higher than White and Native American (83.2) populations. Given that higher the transit trips index, the more likely residents utilize public transit, Black, Hispanic, and Asian/Pacific Islander residents are more likely to use public transit. For residents living below the poverty line, index values increase for all racial/ethnic groups, most notably for the White and Asian/Pacific Islander populations. Transit scores for the population below the poverty line range from 85.2 for the Native American population to 89.6 for the Asian/Pacific Islander population.

Low transportation cost index values range from 74.1 for the White population to 79.2 for the Black population. The Black population has the highest low transportation cost index score followed by the Hispanic population (77.7), Asian/Pacific Islander population (76.5), and the Native American population (75.7). Low transportation cost scores are higher for the population below the poverty line regardless of race. Black, Hispanic, and Asian/Pacific Islander residents have the highest low transportation cost index values, regardless of poverty status. A higher “low transportation cost” index value indicates a lower cost of transportation. Therefore, transit is less costly for these racial/ethnic groups compared the White and Native American populations.

Los Angeles County is served by a large public transit system including rail systems, bus operations, and transitways. The Metro rail system operates throughout the County and includes a hub in downtown Los Angeles. Additional rail service operators in the County include Metrolink and Amtrak. The Southern California Regional Rail Authority (SCRRA) operates the 416-mile Metrolink commuter rail system, which has its hub in Downtown Los Angeles at Union Station and extends to Ventura, San Bernardino, Riverside, Orange, and San Diego counties. Amtrak provides interstate service from points around the country to Union Station, as well as regional service between major cities throughout California. There are several regional and municipal bus operators in the County; however, the largest is the Metro bus system. Metro operates the Metro Rapid Bus service and the Metro Express Bus service. The Metro rail and bus map is included as Figure D-40. 17 Transit Trips Index: This index is based on estimates of transit trips taken by a family that meets the following description: a 3-person single-parent family with income at 50% of the median income for renters for the region (i.e., the Core-Based Statistical Area (CBSA). The higher the transit trips index, the more likely residents in that neighborhood utilize public transit.
18 Low Transportation Cost Index: This index is based on estimates of transportation costs for a family that meets the following description: a 3-person single-parent family with income at 50% of the median income for renters for the region/CBSA. The higher the index, the lower the cost of transportation in that neighborhood.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-83
Figure D-40: Metro Rail and Busway Map (2022)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-84
Source: Metro – Metro System Maps, October 2022. Accessed January 2023. https://www.metro.net/riding/guide/system-maps/.

Local Trends
HUD opportunity indices are not available for Hermosa Beach. Public transit systems operating in the City include Beach Cities Transit, Torrance Transit, and the Los Angeles Department of Transportation (LADOT) Commuter Express.
• Beach Cities Transit provides fixed route and dial-a-ride transit service in the South Bay. BCT Line 109 connects Riviera Village, Hermosa, Manhattan, El Segundo, Green Line Stations, and the LAX Bus Center. Torrance Transit operates one bus route through Hermosa Beach.
• Torrance Transit Line 13 operates between Redondo Beach Pier and Artesia A (Blue) Line Station, serving major destinations that include Hermosa Beach Pier, South Bay Galleria, Harbor Gateway Transit Center, Dignity Health Sports Park, and California State University, Dominguez Hills.
• LADOT Commuter Express shuttles provide one-way limited stop transit service to job centers during commute hours through Commuter Express Line 438.

Hermosa Beach also has a system of bicycle paths, lanes, and routes throughout the City.

Bike facilities generally run along the western side of the City, mainly along Hermosa Avenue, Monterey Boulevard, and Ardmore Avenue. Bike facilities are shown in Figure D41.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-85
Figure D-41: Bicycle Facilities (2023)
Source: City of Hermosa Beach Bike Facilities Map. Accessed January 2023.

The City also operates a Safe Routes to School Program, partnering with the Hermosa Beach City School District and the Hermosa Beach Police Department. The City and School District have administered surveys of parents to understand walking and biking to school preferences and activities to inform safe routes to school programming and practices.

The HPI includes automobile access and active commuting data as transportation indicators. According to HPI data based on the 2015-2019 ACS, more than 92% of households in all Hermosa Beach tracts have access to an automobile. While this is a large proportion of the population, these tracts received percentile scores ranging from only 32 to 62. Populations of households with access to vehicles in Hermosa Beach tracts are consistent with adjacent areas and larger than other areas of the County such as central and east Los Angeles. Only 1.6% to 9.7% of workers aged 16 or older commute to work by transit, walking, or cycling in Hermosa Beach tracts. The tract in the southeast corner of the City has the smallest population of transit, walking, or cycling commuters. As discussed previously, 76.2% of workers in Hermosa Beach get to work via car, truck, or van (Figure D29). The southern side of the City also has lower jobs proximity index scores compared to the northern and western sides (Figure D-30). Bike facilities (paths, lanes, and routes) are also less accessible to persons residing in the southeastern tract (Figure D-41).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-86
Figure D-42: Healthy Places Index – Active Commuting by Tract (2019) Source: California Healthy Places Index (HPI) (based on 2015-2019 ACS), 2023.

5. Disproportionate Housing Needs
The AFFH Rule Guidebook defines disproportionate housing needs as a condition in which there are significant disparities in the proportion of members of a protected class experiencing a category of housing needs when compared to the proportion of a member of any other relevant groups or the total population experiencing the category of housing need in the applicable geographic area (24 C.F.R. § 5.152). The analysis is completed by assessing cost burden, overcrowding, and substandard housing.

The Comprehensive Housing Affordability Strategy (CHAS) developed by the Census for HUD provides detailed information on housing needs by income level for different types of households in Los Angeles County. Housing problems considered by CHAS include:
• Housing cost burden, including utilities, exceeding 30% of gross income; • Severe housing cost burden, including utilities, exceeding 50% of gross income; • Overcrowded conditions (housing units with more than one person per room); and
• Units with physical defects (lacking complete kitchen or bathroom According to 2022 HUD CHAS data based on the 2015-2019 ACS, approximately 51% of Los Angeles County households experience housing problems, compared to 29% of households in Hermosa Beach. In both the County and Hermosa Beach, renters are more likely to be affected by housing problems than owners.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-87
a. Cost Burden
Regional Trend
As presented in Table D-17, in Los Angeles County, approximately 44% of households are cost burdened. Renters experience cost burden at higher rates than owners (52.8% vs.

33.7%), regardless of race. Among renters, Black and Hispanic households are cost burdened at the highest rate (58.8% and 56.1%, respectively). All other racial/ethnic renter groups are cost burdened at a rate below the citywide average of 52.8% for renteroccupied households. Geographically, tracts with larger populations of cost burdened owners are more concentrated in the central and south Los Angeles areas (Figure D-43).

However, tracts with populations of owners exceeding 60% are dispersed throughout the region, including in coastal areas such as Santa Monica and Long Beach. Tracts with larger populations of overpaying renters are also more prevalent in the central and south Los Angeles areas in and around the cities of Los Angeles, Compton, and Westmont, and in the area surrounding Long Beach (Figure D-44). The coastal area from Manhattan Beach to Palos Verdes Estates, including Hermosa Beach, tends to have fewer cost burdened renters.

Table D-17: Housing Problems and Cost Burden by Race/Ethnicity – L.A. County (2019) White Black Asian Amer. Ind Pac. Isl. Hispanic All
With Housing Problem
Owner-Occupied 31.7% 41.3% 36.7% 34.7% 41.6% 45.8% 37.8% Renter-Occupied 51.9% 92.7% 56.1% 56.1% 54.0% 69.4% 61.2% All Households 41.0% 55.5% 45.7% 47.0% 49.5% 60.3% 50.5% With Cost Burden
Owner-Occupied 30.7% 39.8% 33.0% 33.1% 31.0% 36.7% 33.7% Renter-Occupied 48.6% 58.8% 47.3% 51.3% 45.3% 56.1% 52.8% All Households 38.9% 52.4% 39.7% 43.6% 40.1% 48.6% 44.1% Source: HUD CHAS data (based on 2015-2019 ACS), 2022.

Housing problems and cost burdens can also affect special needs populations disproportionately. Table D-18 shows that elderly renters and large renter households experience housing problems at rates exceeding the countywide average for renteroccupied households. Over 83% of large renter households have one or more housing problem but only 52.5% are cost burdened. This is likely due to the population of large households that are overcrowded. Large owner households also experience housing problems at a rate exceeding the countywide average for owner-occupied households.

Approximately 56% of elderly renters are cost burdened compared to only 52.8% countywide. Elderly households are more likely to have fixed incomes and overpay for housing.

Table D-18: Housing Problems and Cost Burden by Household Type – L.A. County (2019) Owner-Occupied Renter-Occupied All HH
Elderly Large HH All Owner Elderly Large HH All Renter
Any housing problem 37.0% 52.1% 37.8% 65.7% 83.3% 61.2% 50.5% Cost burden >30% 37.8% 30.0% 33.7% 56.3% 52.5% 52.8% 44.1%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-88
Owner-Occupied Renter-Occupied All HH
Elderly Large HH All Owner Elderly Large HH All Renter
Source: HUD CHAS data (based on 2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-89
Figure D-43: Regional Population of Cost Burdened Owners by Tract (2019) Source: HUD AFFH Data Viewer (2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-90
Figure D-44: Regional Population of Cost Burdened Renters by Tract (2019) Source: HUD AFFH Data Viewer (2015-2019 ACS), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-91
Local Trend
Housing problem and cost burden rates are lower in Hermosa Beach (28.8% and 26.6%, respectively, Table D-19) than in the County overall (50.5% and 44.1%, respectively, Table D-17). Since the 2006-2010 HUD CHAS data, cost burden has decreased in Hermosa Beach.

In 2010, 38% of households were cost burden, including 36.4% of owner households and

39.2% of renter households. Unlike the countywide trend, Asian (50%) and American Indian (46.2%) renter households are cost burdened at the highest rates. As presented in Table D12 previously, the Asian and American Indian populations in Hermosa Beach also have the highest poverty rates compared to other racial/ethnic groups. Hispanic renter households are also cost burdened at a rate exceeding the citywide average for renter-occupied households (41%). White and Black renters are cost burdened at rates below the citywide average. Asian and Hispanic owners are also cost burdened at rates exceeding 25.2%, the citywide average for owner-occupied households. There are no cost burdened Black or American Indian owners in the City.

As shown in Figure D-45, between 20% and 40% of owners are cost burdened in most Hermosa Beach tracts. Tract 6210.05 in the northwestern section of the City has a slightly larger population of overpaying owners with mortgages of 56.5%. Less than 38% of owners are cost burdened in the remaining Hermosa Beach tracts. Tract 6210.05 also contains block groups with LMI household populations exceeding 25% and lower median income compared to other areas of the City (see Figure D-18 and Figure D-24).

Between 20% and 40% of renters are also cost burdened in tracts on the western side of the City (tracts 6210.05 and 6211.04) (Figure D-46). Only 19.8% of renters are cost burdened in tract 6211.02 in the southeast corner of the City while 45.6% are cost burdened in tract 6210.01 in the northeast section of the City.

As discussed previously, tract 6210.01 has a population of elderly adults aged 65 and older of 15% compared to only 13.9% citywide. Elderly adults are more likely to be retired and have fixed or limited incomes. However, cost burden in Figure D-46 is based on earnings over the past 12 months from when the survey was taken. According to the ACS methodology, earnings are just one kind of income and are primarily wages and salary from a job. Other sources of income that are not considered “earnings” include Social Security payments, pensions, child support, public assistance, annuities, money derived from rental properties, interest and dividends. According to the 2017-2021 ACS, of the 454 households in tract 6210.01 with a householder aged 65 or older, 56.8% have household incomes, including annual earnings and other sources of income, of over $100,000.

Because cost burden is estimated based on earnings alone, the population of households overpaying for housing may be exaggerated, especially in tract 6210.01.

Table D-19: Housing Problems & Cost Burden by Race/Ethnicity – Hermosa Beach (2019) White Black Asian Amer. Ind Pac. Isl. Hispanic All
With Housing Problem
Owner-Occupied 24.1% 0.0% 41.2% 0.0% -- 31.3% 26.5%
Renter-Occupied 29.1% 21.1% 50.0% 76.9% -- 54.1% 30.9%
All Households 26.8% 17.4% 42.7% 62.5% -- 42.2% 28.8%
With Cost Burden
Owner-Occupied 23.3% 0.0% 41.2% 0.0% -- 31.3% 25.2%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-92
White Black Asian Amer. Ind Pac. Isl. Hispanic All
Renter-Occupied 26.7% 21.1% 50.0% 46.2% -- 41.0% 27.8%
All Households 25.2% 17.4% 42.7% 37.5% -- 35.9% 26.6%
Source: HUD CHAS data (based on 2015-2019 ACS), 2022.

Like the trend countywide, larger owner- and renter-occupied households are more likely to experience housing problems in the City (Table D-20). Large renter households are also more likely to be cost burdened. Approximately 55% of large renter households are cost burdened compared to only 28% of renters citywide. Elderly households also overpay for housing at rates exceeding the citywide average.

Table D-20: Housing Problems & Cost Burden by Household Type – Hermosa Beach (2019) Owner-Occupied Renter-Occupied All HH
Elderly Large HH All Owner Elderly Large HH All Renter
Any housing problem 30.2% 33.3% 26.5% 61.8% 58.0% 30.9% 28.8% Cost burden >30% 29.7% 14.0% 25.2% 45.5% 54.6% 27.8% 26.6% Source: HUD CHAS data (based on 2015-2019 ACS), 2022.

Sites Inventory
As described above, three of the four tracts that make up Hermosa Beach have populations of cost burdened owners ranging from 20% to 40%. Consistent with this trend, 86% of RHNA units are in tracts with populations of cost burdened owners in this range (Table D-21). There are 46 lower income units, 20 moderate income units, and 19 above moderate income units in the tract where 56.5% of owner-occupied households are cost burdened. No above moderate income units are located in this tract.

As shown in Table D-22, nearly half of RHNA units are in tracts where 20% to 40% of renters overpay for housing. As presented in Figure D-46, half of Hermosa Beach tracts on the western side of the City have cost burdened renter populations in this range. A larger proportion of units allocated to the lower income RHNA, 35%, are in the tract where 45.6% of renters experience cost burden compared to moderate (19.7%) and above moderate (22.2%) income units.

While there are more lower income units in tracts with higher rates of cost burden, lower income units are not concentrated in these areas alone, nor are they exclusively placed in these tracts. Both tract 6210.01 and 6210.04 contain sites identified to accommodate moderate and mixed income units.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-93
Table D-21: Distribution of RHNA Units by Cost Burdened Owners (2021) Cost Burdened
Owners (Tract)
Lower Income Units Moderate Income
Units
Above Moderate
Income Units Total Units
Units Percent Units Percent Units Percent Units Percent <20% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
20-40% 303 86.8% 158 88.8% 53 73.6% 514 85.8%
40-60% 46 13.2% 20 11.2% 19 26.4% 85 14.2%
60-80% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
>80% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
Total 349 100.0% 178 100.0% 72 100.0% 599 100.0%
Table D-22: Distribution of RHNA Units by Cost Burdened Renters (2021) Cost Burdened
Renters (Tract)
Lower Income Units Moderate Income
Units
Above Moderate
Income Units Total Units
Units Percent Units Percent Units Percent Units Percent <20% 40 11.5% 65 36.5% 28 38.9% 133 22.2%
20-40% 188 53.9% 78 43.8% 28 38.9% 294 49.1%
40-60% 121 34.7% 35 19.7% 16 22.2% 172 28.7%
60-80% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
>80% 0 0.0% 0 0.0% 0 0.0% 0 0.0%
Total 349 100.0% 178 100.0% 72 100.0% 599 100.0%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-94
Figure D-45: Population of Cost Burdened Owners by Tract and Sites Inventory (2021) Source: HUD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-95
Figure D-46: Population of Cost Burdened Renters by Tract and Sites Inventory (2021) Source: HUD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-96
b. Overcrowding
Regional Trend
Overcrowding is defined as housing units with more than one person per room (including dining and living rooms but excluding bathrooms and kitchen). According to 2016-2020 ACS estimates, 11.2% of households in Los Angeles County are living in overcrowded conditions (Table D-23). About 16% of renter households are living in overcrowded conditions in the County, compared to only 5.7% of owner households. Similarly, 7.4% of renter households are severely overcrowded, with more than 1.5 persons per room, compared to only 1.6% of owners. According to 2015-2019 HUD CHAS data, there 203,320 large renter-occupied households with five or more persons, representing 11.3% of renters countywide. There are slightly more large owner households, 214,590, representing 14.1% of owners countywide.

Table D-23: Overcrowded Households by Tenure – Los Angeles County (2020) Owner-Occupied Renter-Occupied Total
Households Percent Households Percent Households Percent Overcrowded
(>1.0 persons per room) 87,325 5.7% 286,881 16.0% 374,206 11.2% Severely Overcrowded
(>1.5 persons per room) 23,819 1.6% 133,699 7.4% 157,518 4.7% Total 1,534,472 100.0% 1,798,032 100.0% 3,332,504 100.0% Source: 2016-2020 ACS (5-Year Estimates).

As presented in Figure D-47 below, tracts with larger populations of overcrowded households in the region surrounding Hermosa Beach are most prevalent in the central and south County areas in and around the cities of Los Angeles, Compton, Hawthorne, South Gate, and parts of Long Beach. Coastal County areas, from Malibu to Ranchos Palos Verdes, are nearly all comprised of tracts with populations of overcrowded households below the statewide average of 8.2%. As discussed throughout this Assessment of Fair Housing Issues, coastal Los Angeles County areas also have smaller racial/ethnic minority populations, fewer LMI households, and higher median incomes compared to inland County areas (see Figure D-5, Figure D-17, and Figure D-22).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-97
Figure D-47: Regional Overcrowded Households by Tract (2020) Source: HUD AFFH Data Viewer (2020 HUD CHAS data), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-98
Local Trend
Overcrowding is generally not an issue in the City. As shown in Table D-24, there are no severely overcrowded owner-occupied households in Hermosa Beach. Only 1.8% of renter-occupied households are severely overcrowded. Only 1.1% of owner households and 3.4% of renter households are overcrowded. While overcrowding is more prevalent amongst Hermosa Beach renters, a significantly smaller proportion are overcrowded compared the County (16%). The rate of overcrowding in all areas of the City is below the statewide average of 8.2%. According to the HCD Data Viewer 2.0, there are no tracts in Hermosa Beach where more than 5% of households are overcrowded.

Table D-24: Overcrowded Households by Tenure (2020)
Owner-Occupied Renter-Occupied Total
Households Percent Households Percent Households Percent Overcrowded
(>1.0 persons per room)
48 1.1% 147 3.4% 195 2.3%
Severely Overcrowded
(>1.5 persons per room)
0 0.0% 76 1.8% 76 0.9%
Total 4,309 100.0% 4,287 100.0% 8,596 100.0%
Source: 2016-2020 ACS (5-Year Estimates).

Sites Inventory
There are no RHNA sites in tracts where overcrowding is a prominent fair housing issue. c. Substandard Housing
Regional Trend
Incomplete plumbing or kitchen facilities can be used to measure substandard housing conditions. Incomplete facilities and housing age are estimated using the 2016-2020 ACS.

In general, residential structures over 30 years of age require minor repairs and modernization improvements, while units over 50 years of age are likely to require major rehabilitation such as roofing, plumbing, and electrical system repairs.

According 2016-2020 ACS estimates, shown in Table D-25, 1.6% of households in Los Angeles County lack complete kitchen facilities and 0.5% lack complete plumbing facilities. Incomplete facilities affect renter households more than owner households.

Approximately 0.4% of owner households lack complete kitchen facilities and 0.3% lack complete plumbing facilities compared to 2.6% and 0.6%, respectively, amongst renter households countywide.

Table D-25: Substandard Housing Conditions by Tenure – Los Angeles County (2020) Owner-Occupied Renter-Occupied Total
Households Percent Households Percent Households Percent Lacking complete kitchen facilities 6,186 0.4% 46,465 2.6% 52,651 1.6% Lacking complete plumbing facilities 3,884 0.3% 11,381 0.6% 15,265 0.5% Total 1,534,472 100.0% 1,798,032 100.0% 3,332,504 100.0%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-99
Owner-Occupied Renter-Occupied Total
Households Percent Households Percent Households Percent Source: 2016-2020 ACS (5-Year Estimates).

Housing age can also be used as an indicator for substandard housing and rehabilitation needs. As stated above, structures over 30 years of age require minor repairs and modernization improvements, while units over 50 years of age are likely to require major rehabilitation. In the County, 85.3% of the housing stock was built prior to 1990, including

59.7% built prior to 1970 (Table D-27). Figure D-48 shows median housing age for cities and Census-designated places (CDPs) in the region surrounding Hermosa Beach. Manhattan Beach, Redondo Beach, and Hermosa Beach tend to have younger housing stocks compared to adjacent jurisdictions to the north, south, and east. The south County areas, including Long Beach, Compton, Lakewood, Lynwood, and South Gate, tend to have older housing stocks.

Figure D-48: Regional Median Housing Age – Cities and CDPs (2020) Source: 2016-2020 ACS (5-Year Estimates).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-100
Local Trend
There are no owner-occupied households in Hermosa Beach lacking complete kitchen or plumbing facilities (Table D-26). There are also no renter-occupied households in the City lacking complete plumbing facilities. There are 59 renter households, representing 1.4% of renters citywide, lacking complete kitchen facilities. Households lacking complete facilities are much less prominent in Hermosa Beach compared to the County, where 2.6% of renters lack complete kitchen facilities and 0.6% lack complete plumbing facilities.

Table D-26: Substandard Housing Conditions by Tenure (2020) Owner-Occupied Renter-Occupied Total
Households Percent Households Percent Households Percent Lacking complete kitchen facilities 0 0.0% 59 1.4% 59 0.7% Lacking complete plumbing facilities 0 0.0% 0 0.0% 0 0.0% Total 4,309 100.0% 4,287 100.0% 8,596 100.0%
Source: 2016-2020 ACS (5-Year Estimates).

Table D-27 shows housing stock age in the County, City, and Hermosa Beach tracts. Only 52% percent of housing units in the City were built in 1969 or earlier compared to 60% countywide. As discussed previously, units aged 50 and older are likely to require major rehabilitation. Another 29.7% of units in the City were built between 1970 and 1989. The remaining 18.6% of housing units in Hermosa Beach were constructed in 1990 or later, a larger proportion than in the County (14.7%).

As shown in Figure D-49, tracts 6210.05, northwestern quarter, and 6211.02 , southeastern quarter, have older median housing ages compared to tracts 6210.01 and 6211.04. Nearly 66% of housing units in tract 6210.05 and 60% in tract 6211.02 were built prior to 1970 compared to 50% in tract 6210.01 and 39% in tract 6211.04 (Table D-27). Tract 6211.04 has the largest proportion of new housing units built in 1990 or later (24.9%).

According to the HCD AFFH Data Viewer 2.0, the southwest section of the City, tract 6211.04, has a larger proportion of renter-occupied households compared to other tracts.

As mentioned above, this tract has the largest proportion of new housing units built in 1990 or later.

There are no tracts in Hermosa Beach where more than 2% of households lack complete plumbing facilities. Tract 6210.05 in the northwestern corner of Hermosa Beach is the only tract in the City where more than 2% of households lack complete kitchen facilities. This section of the City also has a higher rate of cost burdened owners, but a population of cost burdened renters consistent with the citywide trend (see Figure D-45 and Figure D-46).

Table D-27: Housing Stock Age (2020)
Tract/Jurisdiction 1969 or Earlier (50+
Years)
1970-1989 (30-50
Years)
1990 or Later (<30
Years)
Total Housing
Units
6210.01 50.0% 37.5% 12.5% 2,071
6210.05 65.7% 18.4% 16.0% 2,955
6211.02 59.5% 23.9% 16.5% 1,216
6211.04 38.6% 36.5% 24.9% 3,577
Hermosa Beach 51.7% 29.7% 18.6% 9,819

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-101
Tract/Jurisdiction 1969 or Earlier (50+
Years)
1970-1989 (30-50
Years)
1990 or Later (<30
Years)
Total Housing
Units
Los Angeles County 59.7% 25.5% 14.7% 3,559,790
Source: 2016-2020 ACS (5-Year Estimates).

Figure D-49: Median Housing Age by Tract (2020)
Source: 2016-2020 ACS (5-Year Estimates).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-102
Figure D-50: Renter-Occupied Household Populations by Tract (2021) Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-103
Figure D-51: Units Lacking Complete Kitchen Facilities by Tract (2021) Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-104
d. Displacement Risk
Regional Trends
UC Berkley’s Urban Displacement project defines residential displacement as “the process by which a household is forced to move from its residence - or is prevented from moving into a neighborhood that was previously accessible to them because of conditions beyond their control.” As part of this project, the research has identified populations vulnerable to displacement (named “sensitive communities”) in the event of increased redevelopment and drastic shifts in housing cost. Vulnerability is defined based on the share of low income residents per tract and other criteria including: share of renters above 40%, share of people of color more than 50%, share of low income households severely rent burdened, and proximity to displacement pressures. Displacement pressures were defined based on median rent increases and rent gaps. Using this methodology, sensitive communities in the Los Angeles County region surrounding Hermosa Beach were identified throughout the central and south County areas. Sensitive communities are the most concentrated in the area spanning from Glendale to the north, throughout the City of Los Angeles, Inglewood to the west, Compton to the south, and El Monte to the east. There are significantly fewer sensitive communities in the coastal County cities from Malibu to Ranchos Palos Verdes. As mentioned previously, this area, which includes Hermosa Beach, also has smaller non-White and LMI household populations and higher median incomes compared to inland County areas (see Figure D-5, Figure D-17, and Figure D-22). TCAC areas of high segregation and poverty and R/ECAPs are also more prevalent in the central and south County areas where sensitive communities are concentrated (see Figure D-19).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-105
Figure D-52: Regional Sensitive Communities at Risk of Displacement by Tract (2020) Source: HCD AFFH Data Viewer (UC Berkeley Urban Displacement Project, 2020), 2023.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-106
Local Trends
As shown in Figure D-52 above, there are no tracts that have been identified as sensitive communities in Hermosa Beach. The closest sensitive communities are located in Torrance and Lawndale east of the City. There are also no sensitive communities in the adjacent jurisdictions of El Segundo, Manhattan Beach, and Redondo Beach.

Displacement of low-income households can occur through the expiration of affordability restrictions on assisted low-income housing, escalation of market rents, or demolition of existing rental units. As noted in the Needs Assessment of this Housing Element, there are no low-income rental projects at risk of conversion to market rate during the 2021-2031 period.

As discussed previously, vulnerability is measured based on several variables including:
share of renters exceeding 40%, share of people of color exceeding 50%, share of low income households severely rent burdened, and proximity to displacement pressures.

Displacement pressures were defined based on median rent increases and rent gaps.

Hermosa Beach has an owner population of 50.1% with a non-White population of only 25%. In comparison, only 46% of households are owners and 74.1% of the population belongs to a racial/ethnic minority group countywide. Over the past decade, both the owner population and non-White population have increased (from 45.6% and 19.6%, respectively, during the 2006-2010 ACS). As presented in Figure D-53, Asian householders are the most likely to own their home (67.7%), followed by Hispanic/Latino householders (55.7%), and White householders (50.3%). Black/African American householders in the City are significantly less likely to own their home. Only 9.6% of Black/African American householders are owners. Fewer householders of some other race (30.5%) and American Indian/Alaska Native householders (32.8%) are homeowners.

Figure D-53: Housing Tenure by Race of Householder (2020)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-107
Source: 2016-2020 ACS (5-Year Estimates).

Figure D-54 shows the median contract rent in Hermosa Beach and Los Angeles County from 2009 to 2020. During this period, the median contract rent in Hermosa Beach increased 24.8% (from $1,743 in 2010 to $2,176 in 2020), a smaller increase than 39.1% countywide (from $1,017 to $1,415). While rental prices have increased more countywide, median contract rent prices in Hermosa Beach remain higher than rental prices throughout the County. As presented above, increasing rental prices in the City are more likely to disproportionately affect people of color, specifically Black/African American households, households of some other race, and American Indian/Alaska Native households.

Figure D-54: Median Contract Rent (2009-2020)
Source: 2006-2010 through 2016-2020 ACS (5-Year Estimates). e. Homelessness
Regional Trend
The Los Angeles Homeless Services Authority (LAHSA) estimates there were 69,144 persons experiencing homelessness in the Los Angeles County, based on the 2022 Greater Los Angeles Homeless Point-in-Time (PIT) Count. Figure D-55 shows the Los Angeles County homeless populations from 2017 to 2022. As of 2022, 70% of the homeless population is unsheltered and 30% is sheltered. The proportion of sheltered individuals has increased slightly since 2017, when 27.2% of the population experiencing homelessness was sheltered. The homeless population has increased over 25% since 2017, and 4.1% since 2020.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-108
As shown in Table D-28, of the individuals experiencing homelessness, 3.5% were transitional age youths aged 18 to 24 and 0.2% were unaccompanied minors under the age of 18.

Another 5.7% of the homeless population were veterans and 41.3% were experiencing chronic homelessness. A household is considered chronically homeless if any of its members have (1) a long-term disabling condition; and (2) been homeless for 12 months or more within the last 3 years as specified by HUD.

There are many emergency shelters in Los Angeles County. Emergency shelters are most prevalent in the central County areas such as the City of Los Angeles.

Figure D-55: L.A. County Population of Persons Experiencing Homelessness (2017-2022) Note: LA County data includes the Los Angeles Continuum of Care, and the cities of Pasadena, Glendale, and Long Beach.

Source: Los Angeles County Homeless Services Authority (LAHSA) Greater Los Angeles Homeless Count – Los Angeles County, 2017-2022.

Table D-28: Characteristics of Persons Experiencing Homelessness – LA County (2022) Sheltered Unsheltered
Total
Persons Percent
Total Persons 20,596 48,548 69,144 --
Total Households 14,248 47,586 61,834 --
Individuals (those not in family units) 11,153 47,098 58,251 -- Transitional Age Youth (18-24)1 994 1,073 2,067 3.5%
Unaccompanied Minors (under 18)1 116 5 121 0.2%
Family Households (at least 1 child under 18) 3,095 488 3,583 -- All Family Members 9,443 1,450 10,893 --
Veterans2 929 3,013 3,942 5.7%
People Experiencing Chronic Homelessness (all)2 4,992 23,584 28,576 41.3%

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-109
Sheltered Unsheltered
Total
Persons Percent
Notes:

1. Percent of individuals

2. Percent of total persons
Source: LAHSA 2022 Greater Los Angeles Homeless Count – Los Angeles County.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-110
Figure D-56: Regional Emergency Shelter Locations (2020) Source: HCD AFFH Data Viewer (HUD 2020), 2022.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-111
As of November 2023, LAHSA recently released the results of the 2023 Los Angeles Continuum of Care (CoC) survey. The CoC covers all of Los Angeles County except Pasadena, Glendale, and Long Beach. The 2023 survey estimates the population of persons experiencing homelessness is 71,320, 26.7% of whom were sheltered and 73.3% unsheltered.

Table D-29 compares the population of persons experiencing homeless by race/ethnicity to the Countywide distribution. The Black/African American population is the most overrepresented in the homeless population. The American Indian/Alaksa Native population, Native Hawaiian and other Pacific Islander population, and population of multiple races are also slightly overrepresented in the homeless population.

Table D-29: Population of Persons Experiencing Homelessness by Race/Ethnicity – Los Angeles County (2021/2023)
Race/Ethnicity Share of Homeless Population Share of Total Population Persons Percent Persons Percent
Hispanic/Latino 30,350 42.6% 4,878,619 48.7%
Not Hispanic/Latino 40,970 57.4% 5,141,016 51.3%
American Indian/Alaksa Native 723 1.0% 19,571 0.2%
Asian 1,212 1.7% 1,458,140 14.6%
Black/African American 22,606 31.7% 766,190 7.6%
Native Hawaiian/Other Pacific Islander 389 0.5% 21,433 0.2% White 13,826 19.4% 2,550,832 25.5%
Multiple Races 2,214 3.1% 281,399 2.8%
Total 71,320 100.0% 10,019,635 100.0%
Source: LAHSA 2023 Greater Los Angeles Homeless Count – Los Angeles County; 2017-2021 Acs (5-Year Estimates).

According to the 2023 LAHSA Homeless Count, 27% of persons experiencing homelessness also have substance abuse disorders, 2% have HIV/AIDs, 25% struggle with serious mental illness, 10% have a developmental disability, and 19% have a physical disability.

Local Trends
According to the LAHSA Point-In-Time (PIT) count for Hermosa Beach, in 2022 there were 34 persons experiencing homelessness in the City in 2022, all of whom were unsheltered.

Since 2016, the population of persons experiencing homelessness in the City has increased.

In 2016, there were only 20 people counted experiencing homelessness in Hermosa Beach, including six who were sheltered.

In 2022, most persons experiencing homelessness in Hermosa Beach were living in vans (50%). Another 27% were on the street, 18% were in cars, and 5% were in RVs or campers.

As shown above, there is one emergency shelter in Hermosa Beach. This shelter has a total of 20 beds.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-112
Figure D-57: Hermosa Beach PIT Homeless Population (2022) Source: LAHSA Homeless Count by Community/City – Hermosa Beach, 2022.

According to LAHSA 2022 Homeless Count data at the tract-level, tract 6211.04 had the largest population of persons experiencing homelessness (25 persons) compared to other tracts in Hermosa Beach. One person was counted in tract 6210.02, six in tract 6210.04, and two in tract 6211.02. Tract 6211.04 encompasses the southwest quadrant of the City. The emergency shelter is located in the northwest quadrant of the City in tract 6210.05.

Tract 6211.04 is generally bound by Pier Avenue to the north and the Pacific Coast Highway to the east which includes much of Downtown Hermosa Beach, adjacent to the Hermosa Beach Pier (extending along Hermosa Avenue and Pier Avenue). Line 109 of the Beach Cities Transit routes has one stop in Hermosa Beach (Pier Avenue) and connects to Riviera Village, Downtown Manhattan Beach, Downtown El Segundo, Douglas Green Line Station, The Pointe, Plaza El Segundo, Aviation/LAX Green Line station, and the LAX Bus Center. The Torrance Transit Line 13 also operates between Redondo Beach Pier and Artesia A (Blue) Line Station, serving major destinations that include Hermosa Beach Pier, South Bay Galleria, Harbor Gateway Transit Center, Dignity Health Sports Park, and California State University, Dominguez Hills. LA Commuter Express shuttles provide one-way limited stop transit service to job centers during commute hours. Commuter Express Line 438 provides morning commute service from the beach cities to Downtown LA and

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-113
evening service from Downtown to the beach cities. Additionally, under the City’s 2018 Homelessness Plan Supporting Action #1f includes local funds to support response efforts and special circumstances. This fund can cover items such as miscellaneous services and materials, motel vouchers, transit vouchers, laundry services, hygiene products, etc.

Although the 2018 Homelessness Plan stated a 5-year timeline, the programs are ongoing and continue forward until such time that the Plan is updated.

According to the City’s 2018 Homelessness Plan, The demographics of Hermosa Beach’s homeless population appear to be consistent with that of other beach cities in the South Bay, and the City’s total homeless population is among the lowest in the region on a percapita basis. Nevertheless, according to information gleaned through interactions with the City’s Police Department, PATH outreach workers and the faith-community, Hermosa Beach’s homeless population may be categorized as diverse and displaying varying needs for service.
• Chronically homeless individuals often have a disabling condition, and have been homeless for a year or more, or have had at least four episodes of homelessness in the past three years. These individuals are typically well known to HBPD, businesses, and the faith community, and are often the source of calls received by HBPD. They typically have co-occurring substance abuse and mental illness, and most have been unable to take advantage of services when they are offered. Several individuals are long-time, well-known local residents; others are more recent arrivals in Hermosa Beach.
• Recently homeless people have lost their housing during the past year for reasons such as losing a job, medical bills, marital breakdown, or a property owner’s decision to go out of the rental business. They may be able to benefit from emergency rental assistance or other programs available through Harbor Interfaith or PATH. These individuals may be known to the school district if their children are enrolled in local schools, and may also be known to faith groups that offer laundry and meals to people who are homeless. Most people in this category are local residents who want to stay in the area for school, a job, or community accessibility, and some live in their vehicles. • Transients often find their way to Hermosa Beach, especially in the summer months, seeking beachside living. Some of these people are youth, and some may be willing to return to their home outside of Los Angeles County or out of state if resources are available.
• People at imminent risk of homelessness, including families, often use services such as laundry, meals, and food pantries offered by the faith community.

Intervention with these people prior to homelessness will help prevent additional people from becoming homeless in the community.

Through regional service providers such as PATH and the Los Angeles Homeless Services Authority, Hermosa Beach has access to shelter beds, when they are available. However, there is a significant shortage of shelter beds available in Los Angeles County and wait lists for housing are extremely long. The City Council has approved $20,000 in the FY2022-2023 budget to use for securing temporary housing for people experiencing homelessness in Hermosa Beach. Hermosa Beach Police also have worked with other agencies in the past

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-114
to secure shelter beds for people experiencing homelessness. The City also implements outreach and engagement efforts under the Homelessness Plan with the following organizations: South Bay Cities Council of Governments (SBCCOG), Harbor Interfaith Services (HIS), People Assisting the Homeless (PATH), Los Angeles County Department of Mental Health's Mental Evaluation Team, 1736 Family Crisis Center, South Bay Coalition to End Homelessness (SBCEH), Hermosa Beach Chamber of Commerce, faith-based organizations, Hermosa Beach Community non-profit organizations, Hermosa Beach Neighborhood Watch, Beach Cities Health District, Hermosa Beach City School District, Los Angeles County Library, Los Angeles County Department of Beaches and Harbors, Los Angeles County Fire Department, Los Angeles County Lifeguard, and City agencies (Elected and appointed officials, City Manager's office, Hermosa Beach Police Department, Community Services, Community Development/Code Enforcement, Public Works, Community Resources (Parks and Senior Center), and the Emergency Operations Center).

In 2022, the City of Hermosa Beach began hosting Housing Initiative Courts on a monthly basis, to provide people experiencing homelessness an opportunity to avoid prosecution on non-violent misdemeanor charges in exchange for accepting judge-mandated services that can eventually lead to placement in housing. In 2023, the City also launched a grant-funded Mobile Crisis Response Pilot Program to help people experiencing homelessness and mental health crises. This supports a civilian team that responds to nonemergency and non-medical situations with individuals experiencing homelessness and in need of mental health services. This mobile crisis response team is trained to de-escalate situations and work with Harbor Interfaith Services, which assists with homelessness.

Outreach efforts and services for persons experiencing homelessness are outlined in Table II-2, Affirmatively Furthering Fair Housing Summary Actions, of this Housing Element.

6. Local Knowledge and Other Relevant Factors
a. Zoning and Housing Type
The City’s Zoning Map is presented in Figure D-58. The northern and eastern areas are predominantly zoned for single-family residential uses (R-1). The northernmost section of the City, north of 27th Street, the area along Hermosa Avenue north of 16th Street, and the area south of Pier Avenue between Valley Drive and the PCH have larger pockets zoned for two-family residential uses (R-2). The southwest section of the City has the largest areas zoned for multiple family residential uses (R-3). As discussed above, the southwest corner of the City also has the largest proportion of renter-occupied households (see Figure D-50).

The southeastern corner of the City is comprised of nearly all R-1 zoning designations and has the smallest proportion of renters compared to other Hermosa Beach tracts. Consistent with zoning designations, the western side of the City has larger shares of housing structures with two or more units compared to the eastern side (Figure D-59). The western side of the City also contains block groups where more than 25% of households are LMI. All block groups on the eastern side of the City have LMI household populations below 25% (see Figure D-18).

As discussed previously, the areas north of Pier Avenue and Aviation Boulevard have larger populations of persons living alone and elderly adults (see Figure D-15 and Figure D-16).

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-115
There are two mobile home parks in the City, one in tract 6210.05 (Marineland MHP) and one in tract 6211.04 (Hermosa Beach RV Court). According to the California Housing Partnership Affordable Housing Map and Benefits Calculator, there are no state- or federally-subsidized affordable homes in Hermosa Beach.19 19 California Housing Partnership – Affordable Housing Map and Benefits Calculator. Accessed May 2023. https://chpc.net/datatools/affordablehomes/.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-116
Figure D-58: Hermosa Beach Zoning Map (2021)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-117
Figure D-59: Structures with Two or More Units by Tract (2021)

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-118
Source: HCD AFFH Data Viewer 2.0 (2017-2021 ACS), 2023. b. Lending Practices and Home Loan Trends
A key aspect of fair housing choice is equal access to credit for the purchase or improvement of a home, particularly in light of the recent lending/credit crisis. In the past, credit market distortions and other activities such as “redlining” were prevalent and prevented some groups from having equal access to credit. The Community Reinvestment Act (CRA) in 1977 and the subsequent Home Mortgage Disclosure Act (HMDA) were designed to improve access to credit for all members of the community and hold the lender industry responsible for community lending. Under HMDA, lenders are required to disclose information on the disposition of home loan applications and on the race or national origin, gender, and annual income of loan applicants.

Table D-30 summarizes home purchase and improvement loan applications in Los Angeles County for 2021. Under the Home Mortgage Disclosure Act (HDMA), lending institutions are required to disclose information on the disposition of loan applications along with the income, gender, and race of loan applicants. Overall, 671,854 households applied for loans for homes in Los Angeles County in 2021. Of the applications for home purchase loans, 63% were approved and 7.2% were denied. An additional 29.4% were withdrawn by the applicant, closed for incompleteness, or purchased. Home improvement loans were denied at the highest rate of 33%.

Table D-30: Home Purchase and Improvement Loan Applications – LA County (2021) Loan Type Originated or
Approved Denied Other Total
Home purchase 63.4% 7.2% 29.4% 132,322
Home improvement 47.6% 33.2% 19.2% 22,150
Refinancing 59.0% 9.6% 31.4% 310,635
Cash-out refinancing 60.1% 10.3% 29.6% 187,576
Other purpose 50.6% 30.5% 18.9% 17,361
Not applicable 9.4% 0.7% 89.8% 1,810
Total 59.4% 10.6% 30.0% 671,854
Note: Other = Withdrawn by applicant, closed for incompleteness, purchased loan.

Source: FFIEC Home Mortgage Disclosure Act Data (HMDA) – Los Angeles County, 2021.

Table D-31 shows home loan applications in Los Angeles County in 2021 by race and ethnicity of applicants. Countywide, applicants of two or more minority races (19%), American Indian/Alaska Native applicants (18.2%), Native Hawaiian or other Pacific Islander applicants (15.9%), and Black or African American applicants (15.7%) were denied at the highest rates. Hispanic/Latino applicants were denied at a higher rate (13.6%) compared to non-Hispanic applicants (10.8%). Asian applicants, joint race applicants, joint ethnicity applicants, and applicants of an unknown race were the only racial/ethnic groups with denial rates below 10.6%, the average for all loan applications. White applicants also had a lower denial rate of 11% compared to most racial/ethnic minority groups.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-119
Table D-31: Home Loan Applications by Race/Ethnicity – LA County (2021) Originated or
Approved Denied Other Total
2 or more minority races 54.7% 19.0% 26.3% 1,092
American Indian or Alaska Native 52.1% 18.2% 29.7% 3,078 Asian 67.5% 10.4% 22.1% 88,115
Black or African American 59.8% 15.7% 24.5% 32,425
Joint 70.6% 8.5% 21.0% 15,329
Native Hawaiian or Other Pacific Islander 59.0% 15.9% 25.1% 1,796 Race Not Available 45.2% 9.5% 45.3% 226,397
White 67.2% 11.0% 21.8% 303,463
Hispanic or Latino 62.8% 13.6% 23.7% 130,061
Not Hispanic or Latino 66.8% 10.8% 22.4% 323,672
Joint 69.2% 9.9% 20.8% 17,198
Grand Total 59.4% 10.6% 30.0% 671,854
Note: Other = Withdrawn by applicant, closed for incompleteness, purchased loan.

Source: FFIEC Home Mortgage Disclosure Act Data (HMDA) – Los Angeles County, 2021.

C. Sites Inventory
AB 686 requires a jurisdiction’s site inventory “…be used to identify sites throughout the community, consistent with…” its duty to affirmatively further fair housing. The number of units, location and assumed affordability of identified sites throughout the community (i.e., lower, moderate, and above moderate income RHNA) relative to all components of the assessment of fair housing was integrated throughout the discussion in the fair housing assessment section. The City’s sites inventory is presented in Figure D-60 and shown by site, tract, and AFFH variable in Table D-32. For the purposes of this Assessment of Fair Housing, the sites analysis is further discussed with respect to the four Hermosa Beach tracts: 6210.01 (northeast), 6210.05 (northwest), 6211.02 (southeast), 6211.04 (southwest).

Hermosa Beach is an affluent area with high access to opportunities and resources. All areas of the City generally have low levels of disproportionate housing needs such as cost burden, overcrowding, and substandard housing conditions. Further, the City’s RHNA strategy is distributed throughout Hermosa Beach and is not concentrated in a single tract or block group alone. Sites identified to meet the RHNA promote mixed income communities and new housing opportunities for lower income households in highest resource areas. In addition, the Housing Sites Inventory consists primarily of underutilized sites occupied by non-residential uses; therefore, there is not a substantial displacement risk of in these areas. However, if redevelopment is proposed on properties with existing housing units, displacement mitigation strategies will be required consistent with State law.

The RHNA strategy does not exacerbate conditions related to fair housing in Hermosa Beach.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-120

1. Northeast Hermosa Beach (Tract 6210.01)
Tract 6210.01 is bound by the north and east City boundaries, Valley Drive to the west, and Pier Avenue/Aviation Boulevard to the south. This area is zoned primarily for single-family residential uses (R-1), with smaller pockets zoned for limited multiple family residential (R2B), multiple family residential (R-3), and two-family residential (R-2) uses. Non-residential zones in this section of the City include general and highway commercial (C-3), specific plan areas for both residential and commercial uses (SPA), and open space (OS). A total of 172 RHNA units over six sites are located in tract 6210.01, including 121 lower income units, 35 moderate income units, and 16 above moderate income units.

Like all Hermosa Beach tracts, tract 6210.01 is a highest resource area and an RCAA. RHNA sites in this section of the City are in a block group with a non-White population of 26.5%, compared to 25% citywide, and an LMI household population of 14%, compared to 22.3% citywide. While this area has a smaller LMI household population compared to Hermosa Beach as a whole, a larger proportion of renters are cost burdened in this tract (45.6%) compared to households citywide (27.8%) and other Hermosa Beach tracts. As discussed in this Assessment of Fair Housing, this tract has a larger population of single-person households (householder living alone) and elderly adults compared to the southern tracts.

Elderly populations are more likely to earn fixed or limited incomes and experience cost burden. Further, cost burden is based on annual earnings alone, which does not include Social Security payments, pensions, child support, public assistance, annuities, money derived from rental properties, interest, and dividends. As discussed previously, nearly 57% of households with a householder aged 65 or older in tract 6210.01 have household incomes, including annual earnings and other sources of income, of over $100,000. Cost burden is likely exaggerated in this tract due to the population of elderly adults residing in this tract. Tract 6210.01 also has a smaller proportion of cost burdened owners (23.8%) compared to the City (25.2%).

The City’s RHNA strategy identifies sites that can accommodate both lower and moderate income units in tract 6210.01, promoting new housing opportunities for households of various income levels. The sites selected to meet the RHNA do not exacerbate conditions related to fair housing in northeast Hermosa Beach.

2. Northwest Hermosa Beach (Tract 6210.05)
Tract 6210.05 is bound by the coast to the west, the northern City boundary, Valley Drive to the east, and Pier Avenue to the south. Tract 6210.05 is characterized by a mix of R-1 and R-2 zoning designations with smaller areas zoned for R-2B, R-3, and limited single-family residential (R-1A) uses. Non-residential zoning designations in tract 6210.05 include OS, SPA, limited business and residential (C-1), general commercial (C-2), and mobile home park (MHP). There are five RHNA sites in this tract with a capacity for 85 units (46 lower income, 20 moderate income, and 19 above moderate income).

Tract 6210.05 is a highest resource area and has been identified as an RCAA. Only 18.5% of the population in this area belongs to a racial or ethnic minority population.

Comparatively, 25% of the population citywide is non-White. This tract does contain block groups with larger LMI household populations compared to the citywide average. Sites 2, 3, 4, and 5 are in a block group with an LMI household population of 35%, while site 1 is in a block group with an LMI household population of 22%. Site 1 has a capacity of 7 units,

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-121
all of which are allocated towards the lower income RHNA. Tract 6210.05 has a larger proportion of cost burdened renters compared to the southern tracts and a larger proportion of cost burdened owners compared to all City tracts. As discussed above, this tract has the largest population of persons living alone (28.2%) and persons aged 65 and older (21.2%) compared to other Hermosa Beach tracts. This area also contains block groups with lower median incomes. According to the HCD Data Viewer 2.0 based on the 2017-2021 ACS, tract 6210.05 has a median income of $134,032 compared to $150,417 in tract 6210.01, $168,977 in tract 6211.02, and $143,469 in tract 6211.04. One of the two mobile home parks in the City, Marineland MHP (60 units) is located in this tract.

While the median household income in this tract is lower compared to other Hermosa Beach tracts, it is significantly higher than the countywide median of $76,367. While cost burden is heightened in this tract, this is likely due to the elderly population with fixed or limited incomes. As discussed above, cost burden is based on annual earnings alone, and does not include Social Security payments, pensions, child support, public assistance, annuities, money derived from rental properties, interest, and dividends. Nearly 45% of households with a householder aged 65 or older earn more than $100,000 and only 9% earn less than $25,000. Overall, like Hermosa Beach as a whole, tract 6210.05 is an affluent area with highly accessible opportunities and resources. Further, the RHNA strategy allocates both lower and moderate income units in this tract, ensuring units of a single income level are not concentrated in this area alone. The City’s RHNA strategy in northwest Hermosa Beach does not exacerbate existing fair housing issues.

3. Southeast Hermosa Beach (Tract 6211.02)
Tract 6211.02 is bound by the south and east City boundaries, Aviation Boulevard to the north, and the PCH to the west. Tract 6211.02 is primarily zoned for R-1 uses with smaller pockets zoned for R-2, R-2B, R-3, SPA, OS, C-3, and residential-professional (R-P). The City has identified eight RHNA sites with a capacity of 133 units, including 40 lower income units, 65 moderate income units, and 28 above moderate income units.

Tract 6211.02 has been identified as a highest resource area and RCAA. In the area where RHNA sites are located, 28% of the population belongs to a racial or ethnic minority group

19.8% of renters are cost burdened, and 34.2% of owners are cost burdened. This area has a slightly larger non-White population and population of cost burdened owners compared to the City (25% and 25.2%, respectively). According to 2022 HUD CHAS data based on the 2015-2019 ACS, 27.8% of renters citywide are cost burdened. Sites 14, 15, 19, and 21 are in block groups where 16% of households are LMI and sites 23, 27, 28, and 29 are in block groups where 15% of households are LMI. Tract 6211.02 has the smallest renter (32.9%) and cost burdened renter (19.8%) populations compared to other Hermosa Beach block groups.

Despite tract 6211.02 being zoned primarily for single-family residential uses that are typically more suitable for above moderate income units, the City’s RHNA strategy includes sites that can accommodate 22 lower income and 65 moderate income units.

The City identifies a mix of sites suitable for households of variable income levels in this section of the City. RHNA sites in tract 6211.02 would not exacerbate conditions related to fair housing.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-122

4. Southwest Hermosa Beach (Tract 6211.04)
Tract 6211.04 is in the southwest corner of Hermosa Beach and is bound by the coast to the west, the southern City boundary, the PCH to the east, and Pier Avenue to the north.

Unlike other areas in Hermosa Beach, there is only one small section of tract 6211.04 along Ardmore Avenue that is zoned R-1. Most of the area west of Valley Drive is zoned R-3 and most of the area between Valley Drive and the PCH is zoned R-2. Other zoning designations in tract 6211.04 include C-1, C-2, SPA, OS, R-P, C-3, residential planned development (RPD), and light manufacturing (M-1). There are 10 RHNA sites in tract 6211.04 with a capacity of 209 units (142 lower income, 58 moderate income, and 9 above moderate).

Like all tracts in the City, tract 6211.04 is a highest resource area and RCAA. Only 20.2% of the population where RHNA units are located belongs to a racial/ethnic minority group and only 10% of households are LMI. Comparatively, 25% of the population citywide is nonWhite and 22.3% are LMI households. Tract 6211.04 has larger populations of cost burdened renters and owners (33.9% and 37.7%) compared to the City as a whole (27.8% and 25.2%).

Consistent with zoning designations, this tract has the largest renter population of 60.2% compared to other tracts in the City. This tract generally has small populations of interest (racial/ethnic minority populations, persons with disabilities, LMI households, etc.) and low rates of disproportionate housing needs (cost burden, overcrowding, etc.). This tract also has the highest proportion of new housing units built in 1990 or later. Only 38.6% of housing units in this tract were built prior to 1970 compared to 52% citywide.

Like the entirety of Hermosa Beach, tract 6211.04 is an affluent area with few fair housing issues and high access to opportunities. The RHNA strategy distributes both lower and moderate income units throughout the City including in tract 6211.04, ensuring sites that can accommodate affordable housing are not concentrated in a single area of the City.

RHNA sites in tract 6211.04 promote mixed income communities, 142 lower income units and 58 moderate income units, and provide new housing opportunities for lower income households in high resource areas. The City’s RHNA strategy in tract 6211.04 does not exacerbate existing fair housing issues.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-123
Table D-32: Distribution of RHNA Sites and Units by Tract and AFFH Variable Tract/Site
# of
HHs in
Tract
Total
Capacity
(Units)
Income Distribution
% NonWhite% LMI
HHs*
TCAC
Opp. Cat.
%
Overpay
Renter HH
%
Overpay
Owner HH
RCAA?
Lower Moderate Above
Moderate
6210.01 2,018 172 121 35 16 26.5% 14% Highest 45.6% 23.8% Yes 12) 1601 Pacific Coast Highway (4185-011-061) 96 64 16 16 26.5% 14% Highest 45.6% 23.8% Yes 13) 1100 Pacific Coast Highway (4185-011-039) 14 14 0 0 26.5% 14% Highest 45.6% 23.8% Yes 16) 1021 and 1035 AVIATION (4185-014-001, 4185-014-
015) 8 0 8 0 26.5% 14% Highest 45.6% 23.8% Yes
18) 1055 Aviation Blvd & 1214 Owosso Ave (4185-015-024, -021) 4 0 4 0 26.5% 14% Highest 45.6% 23.8% Yes
19) 1103, 1209 AVIATION (4185-017-015, -014) 43 43 0 0 26.5% 14% Highest 45.6% 23.8% Yes 31) 1706 and 1734 Pacific Coast Highway (4185-002-007,
4185-002-014) 7 0 7 0 26.5% 14% Highest 45.6% 23.8% Yes 6210.05 2,460 85 46 20 19 18.3% 22% - 35% Highest 34.0% 56.5% Yes 1) 1900, -08, -14 Monterey Blvd (4182-019-001, -002, -003) 2 2 0 0 18.3% 22.0% Highest 34.0% 56.5% Yes 2) Monterey Blvd, Loma Dr, 19th St (4183-016-011, -012, - 028, -029, -033, -035 to -040, 4183-023-022) 44 44 0 0 18.3% 35.0% Highest 34.0% 56.5% Yes 3) 301 Pier Ave (4183-017-001) 5 0 5 0 18.3% 35.0% Highest 34.0% 56.5% Yes 4) 321-517 Pier Ave (4183-017-025, -026, 4183-018-001 to - 007, -016 to -018 16 0 6 10 18.3% 35.0% Highest 34.0% 56.5% Yes 5) 555/565 Pier Ave (4183-018-013, -015) 18 0 9 9 18.3% 35.0% Highest 34.0% 56.5% Yes 6211.02 1,231 133 40 65 28 28.0% 15% - 16% Highest 19.8% 34.2% Yes 14) 900, 916, 950 AVIATION (4186-003-017 to -019, -024, - 027, -028, -030) 16 0 16 0 28.0% 16.0% Highest 19.8% 34.2% Yes 15) 1000, 1014, 1016, 1036 AVIATION (4186-002-011 to -
013, -020, -021) 6 0 6 0 28.0% 16.0% Highest 19.8% 34.2% Yes 19) 1062 AVIATION (4186-001-007, -008) 5 0 5 0 28.0% 16.0% Highest 19.8% 34.2% Yes 21) 700 PCH (4186-012-014) 8 0 4 4 28.0% 16.0% Highest 19.8% 34.2% Yes 23) 600, 612, 620 PCH (4186-013-019, -018, -064) 22 22 0 0 28.0% 15.0% Highest 19.8% 34.2% Yes 27) 204/210 PCH & 2nd St (4186-025-002, -027 to -029) 9 0 9 0 28.0% 15.0% Highest 19.8% 34.2% Yes 28) 1st St & PCH (4186-026-800, -801, -804 to -806, -047) 46 0 22 24 28.0% 15.0% Highest 19.8% 34.2% Yes 29) 824 1st St (4186-031-102) 3 0 3 0 28.0% 15.0% Highest 19.8% 34.2% Yes

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-124
Tract/Site
# of
HHs in
Tract
Total
Capacity
(Units)
Income Distribution
% NonWhite% LMI
HHs*
TCAC
Opp. Cat.
%
Overpay
Renter HH
%
Overpay
Owner HH
RCAA?
Lower Moderate Above
Moderate
30) 8, 18, 26 Pacific Coast Highway and 824 1st Street
(4186-031-001, 002, -003, -102, -036) 18 18 0 0 28.0% 15.0% Highest 19.8% 34.2% Yes 6211.04 3,217 209 142 58 9 20.2% 10% Highest 33.9% 37.7% Yes 6) 308 and 318 Pier Ave (4187-011-012, -013) 4 0 4 0 20.2% 10% Highest 33.9% 37.7% Yes 7) 338 Pier Ave (4187-011-054) 4 0 4 0 20.2% 10% Highest 33.9% 37.7% Yes 8) 400, 420, 422 Pier Ave (4187-019-003, -022, -037) 12 0 12 0 20.2% 10% Highest 33.9% 37.7% Yes 9) 506, 514, 526 Pier Ave (4187-020-017, -020, -032) 4 0 4 0 20.2% 10% Highest 33.9% 37.7% Yes 10) 552 11th Pl (4187-020-907) 50 25 25 0 20.2% 10% Highest 33.9% 37.7% Yes 11) 710 Pier Ave (4187-024-902) 50 50 0 0 20.2% 10% Highest 33.9% 37.7% Yes 22) 635 PCH (4187-032-027) 25 25 0 0 20.2% 10% Highest 33.9% 37.7% Yes 24) 709, 721, 723, 725 6th St (4187-033-018 to -022) 10 10 0 0 20.2% 10% Highest 33.9% 37.7% Yes 25) 715/747 5th St (4188-030-001, -002) 34 25 0 9 20.2% 10% Highest 33.9% 37.7% Yes 26) 530 6th St (4188-018-008, -027, -028, -031) 16 7 9 0 20.2% 10% Highest 33.9% 37.7% Yes * Sites within the same tract may be located in different block groups. LMI household populations are estimated at the block group level and may vary between block groups.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-125
Figure D-60: Sites Inventory

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-126
D. Identification and Prioritization of Contributing Factors Contributing factors to fair housing issues. Under the Federal consolidated planning process, the Analysis of Impediments (AI) to Fair Housing Choice is the primary tool for addressing fair housing issues. The City of Hermosa Beach was a participating city with the County of Los Angeles in the preparation of the 2018 AI. Based on extensive analysis of housing and community indicators, and the input of residents, a list of impediments to fair housing choice was developed.

1. Los Angeles County Analysis of Impediments
Appendix D includes a summary of the contributing factors to fair housing issues pertaining specifically to the Urban County and the Housing Authority of Los Angeles County (HACoLA) service areas, which includes Hermosa Beach. These items are prioritized according to the following criteria:

1. High: Impediments/Contributing factors that have a direct and substantial impact on fair housing choice, especially in R/ECAP areas, affecting housing, those impacting persons with disabilities, and are core functions of HACoLA or the Community Development Commission (CDC).

2. Moderate: Impediments/ Contributing factors that have a direct and substantial impact on fair housing choice, especially in R/ECAP areas, affecting housing, those impacting persons with disabilities, and are core functions of HACoLA or the CDC, but the CDC or HACoLA may only have limited capacity to make a significant impact; or may not be within the core functions of HACoLA or the CDC.

3. Low: Impediments/Contributing factors that may have a direct and substantial impact on fair housing choice but are not within the core functions of HACoLA or the CDC or not within the capacity of these organizations to make significant impact, or not specific to R/ECAP neighborhoods, or have a slight or largely indirect impact on fair housing choice.

The impediments/contributing factors identified and included in Appendix D are in relation to the fair housing issues listed below. The prioritization of these contributing factors relates to the ability of the CDC and HACoLA to address the fair housing issues. A low priority does not diminish the importance of the factor in the Urban County or HACoLA service areas but reflects the priority in addressing issues of fair housing. • Segregation
• Racially or ethnically concentrated areas of poverty (R/ECAPs) • Disparities in Access to Opportunity
• Disproportionate Housing Needs
• Discrimination or violations of civil rights laws or regulations related to housing As a participating city in the Los Angeles County CDBG program, Hermosa Beach has access to fair housing outreach, education, and counseling on housing discrimination complaints. The City will continue to advertise the fair housing program through placement

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-127
of fair housing service brochures at the public counter, at the Senior Center and on the City website. Apartment owners and managers are provided with current information about fair housing issues, rights and responsibilities. The Apartment Association of Greater Los Angeles conducts seminars on State, Federal and local Fair Housing laws and compliance issues. In addition, the City will:
• Ensure that all development applications are considered, reviewed, and approved without prejudice to the proposed residents, contingent on the development application’s compliance with all entitlement requirements. • Accommodate persons with disabilities who seek reasonable waiver or modification of land use controls and/or development standards pursuant to procedures and criteria set forth in the applicable development regulations. • Work with the County to implement the regional Analysis of Impediments to Fair Housing Choice and HUD Consolidated Plan.
• Facilitate public education and outreach by posting informational flyers on fair housing at public counters, libraries, and on the City’s website. • Conduct public meetings at suitable times, accessible to persons with disabilities, and near public transit. Resources will be invested to provide interpretation and translation services when requested at public meetings when feasible. • Encourage community and stakeholder engagement during development decisions.

2. Contributing Factors
a. Lack of Fair Housing Testing, Education, and Outreach The City lacks information on fair housing law and discrimination complaint filing procedures on the City website. Current outreach practices may not provide sufficient information related to fair housing, including federal and state fair housing law, and affordable housing opportunities. Cost burdened households throughout the City may be unaware of affordable housing opportunities. As part of the Urban County program, HRC serves Hermosa Beach under contract with LACDA. HRC’s contract with LACDA does not include reporting fair housing records by participating jurisdiction. Service records may reveal gaps in fair housing testing, education, and outreach. A majority of fair housing discrimination cases in Los Angeles County were filed on the basis of disability. While HRC records are not available for Hermosa Beach, the City may lack sufficient education and outreach related to reasonable accommodations and ADA laws based on the proportion of complaints related to disability status countywide.

Contributing Factors
• Lack of fair housing service records
• Lack of fair housing testing
• Lack of monitoring

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-128
• Lack of targeted outreach
Priority Level
High
b. Substandard Housing Conditions
While the City does not have a large proportion of households lacking complete kitchen or plumbing facilities, approximately 81% of housing units are aged 30 years or older, including 52% aged 50 years or older, and may require minor or major rehabilitation. Tracts 6210.05 and 6211.02 have the highest concentration of older housing units, but aging housing units are prevalent citywide.

Contributing Factors
• Age of housing stock
• Cost of repairs or rehabilitation
Priority Level
Low
c. Disparities in Disproportionate Housing Needs
Racial/ethnic minority populations represent only 25% of the population according to the 2016-2020 ACS. However, Asian, American Indian, and Hispanic households are significantly more likely to experience housing problems including cost burden. The American Indian/Alaska Native and Asian populations also have poverty rates of 12.2% and 10%, respectively, compared to only 4.2% citywide. The Black/African American population in the City has a median household income of $86,056, while all other racial/ethnic groups have median household incomes exceeding $139,000. In the City, Black/African American householders, American Indian/Alaska Native householders, and householders of some other race (race other than those included in the ACS) are significantly less likely to own their homes compared to White, Asian, and Hispanic/Latino householders.

Contributing Factors
• Unaffordable rental prices
• Availability of affordable housing
• Private discrimination
Priority
Medium

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-129
d. Lack of Affordable Housing and Housing Mobility
Hermosa Beach’s lack of affordable housing has a disproportionate impact on low- and moderate-income households who are more likely to be households of color. As such, Hermosa Beach lacks racial and ethnic diversity relative to the County overall.

Racial/ethnic minority populations are also more likely to experience housing problems, such as cost burden and overcrowding, and have reduced access to opportunities, such as employment opportunities and better environmental conditions, compared to White populations. Additionally, Hermosa Beach is generally an affluent community with higher income earners. the lack of affordable housing in Hermosa Beach limits housing mobility for lower income households, including households who may work in Hermosa Beach but cannot afford to live in the City.

Contributing Factors
• High land, rental, and ownership housing costs
• Availability of affordable housing
Priority
High

3. Conclusion
This analysis indicates that the primary barrier to fair housing in the city is high housing cost, which has the effect of limiting access by lower-income households to the high opportunities and resources available in Hermosa Beach. There is no evidence to suggest that discrimination against racial groups or persons with disabilities is a major issue.

The Housing Policy Plan includes several programs intended to encourage and facilitate multi-family and mixed-use development to accommodate low- and moderate-income housing, and also encourage the provision of accessory dwelling units, which can expand affordable housing opportunities for lower-income persons such as care-givers, household employees and others working in service occupations. Program 12 describes actions the City will take to affirmatively further fair housing and address any issues of housing discrimination that may arise.

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-130
Racial Characteristics – Hermosa Beach
Source: California Department of Housing and Community Development, AFFH Data Viewer, 2021

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-131
Racially/Ethnically Concentrated Areas of Poverty – Hermosa Beach

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-132
Poverty Status – Hermosa Beach
Source: California Department of Housing and Community Development, AFFH Data Viewer, 2021

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-133
Population with a Disability – Hermosa Beach
Source: California Department of Housing and Community Development, AFFH Data Viewer, 2021

Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 D-134
TCAC/HCD Opportunity Map

1 PROPOSED AMENDMENTS TO THE GENERAL PLAN LAND USE ELEMENT REQUIRED FOR CONSISTENCY WITH THE 2021-2029 HOUSING ELEMENT
Pg # Section Existing Text Amended Text
71 Commercial Commercial designations provide for a wide variety of retail, restaurant, office and other uses that
provide goods or services. Commercial designations
are organized based on the scale and type of goods
or services provided. The most localized
designations are intended to serve a neighborhood
and residents within the immediate vicinity, while
other commercial designations are intended to
serve the entire community or the region.

Commercial designations provide for a wide variety
of retail, restaurant, office, and mixed-uses
(including other residential). that provide goods or
services. Commercial designations are organized
based on the scale and type of goods or services
provided. The most localized designations are
intended to serve a neighborhood and residents
within the immediate vicinity, while other
commercial designations are intended to serve the
entire community or the region.
71 Creative Creative land use designations are intended to provide space for production, design and
manufacturing uses that support the local
employment base and produce goods and services
that enhance the brand of Hermosa Beach as a
creative and innovative community. Uses that are
considered light industrial are to be designed and
sited in a manner that ensures their compatibility
with surrounding uses.

Creative land use designations are intended to
provide space for production, design and
manufacturing uses that support the local
employment base and produce goods and services
that enhance the brand of Hermosa Beach as a
creative and innovative community. Uses that are
considered light industrial are to be designed and
sited in a manner that ensures their compatibility
with surrounding uses. Residential uses, such as
live work and artist space would be also be
consistent in this land use designation.
71 Institutional Institutional uses offer a range of public and community-oriented uses such as schools, parks,
community facilities, administrative offices or
buildings, and space for essential services and
utility needs. Institutional uses also vary in scale
from parkettes at few thousand square feet to the
beach, which includes approximately 63 acres in
size.

Institutional uses offer a range of public and
community-oriented uses such as schools, parks,
community facilities, administrative offices or
buildings, and space for essential services and utility needs. Institutional uses also vary in scale from
parkettes at few thousand square feet to the beach,
which includes approximately 63 acres in size.

Occasionally, residential uses may be appropriately

2 PROPOSED AMENDMENTS TO THE GENERAL PLAN LAND USE ELEMENT REQUIRED FOR CONSISTENCY WITH THE 2021-2029 HOUSING ELEMENT
Pg # Section Existing Text Amended Text
sited within such uses as adaptive re-use of facilities or best use of resources for facilities no longer in
use.
76 Community
Commercial (CC)
Appropriate Land
Uses
This designation provides space for locally oriented
commercial uses including retail stores,
restaurants, professional and medical offices, and
personal services. Uses on the ground floor are
reserved for retail, restaurant, and other sales-tax
revenue generating uses, while offices and personal
service uses are encouraged on upper floors.

Residential uses are not allowed in this designation
as its intent is to promote and protect retail, office, and service uses that diversify the City’s tax base.

This designation provides space for locally oriented
commercial uses including retail stores, restaurants,
professional and medical offices, and personal
services. Uses on the ground floor are reserved for
retail, restaurant, and other sales-tax revenue
generating uses, while offices and personal service
uses are encouraged on upper floors. Residential
uses are not allowed in this designation as its intent
is to promote and protect retail, office, and service
uses that diversify the City’s tax base. Mixed use
developments (including residential uses) may be
allowed.
76 Gateway
Commercial (GC)
Purpose
The Gateway Commercial designation is located at
key entryways and intersections to Hermosa Beach
to offer a greater variety of employment, retail, and
economic activity to the community.

The Gateway Commercial designation also plays a
role in providing services and amenities to visitors
and the region by encouraging hotels and larger
employment centers to be relocated in this area.

With the Gateway Commercial designation
appropriately applied to larger sites, they are
intended to provide both commercial services as
well as facilities that benefit the local community.

The Gateway Commercial designation is located at
key entryways and intersections to Hermosa Beach
to offer a greater variety of employment, retail, and
economic activity to the community.

The Gateway Commercial designation also plays a
role in providing services and amenities to visitors
and the region by encouraging hotels and larger
employment centers to be relocated in this area.

With the Gateway Commercial designation
appropriately applied to larger sites, they are
intended to provide both commercial services as
well as mixed-use (including residential)
developments facilities that benefit the local
community.
76 Gateway
Commercial
In the Gateway Commercial designation, the
ground floor should include community or
regionally oriented retail uses with upper floor high
In the Gateway Commercial designation, the ground
floor should include community or regionally
oriented retail uses with upper floor high visitor

3 PROPOSED AMENDMENTS TO THE GENERAL PLAN LAND USE ELEMENT REQUIRED FOR CONSISTENCY WITH THE 2021-2029 HOUSING ELEMENT
Pg # Section Existing Text Amended Text
Appropriate Land
Uses
visitor office uses. Professional and medical offices
and hotels providing lower cost visitor
accommodations are also allowed in this
designation. Public assembly, recreational, and
other community facilities which are determined to
be compatible with and oriented towards
enhancing the gateway commercial district may
also be allowed. Parking facilities will serve onsite
uses and are encouraged to explore shared parking
agreements with nearby commercial uses to
encourage a “park once” strategy.
office uses. Professional and medical offices and
hotels providing lower cost visitor accommodations
are also allowed in this designation. Public
assembly, recreational, and other community
facilities which are determined to be compatible
with and oriented towards enhancing the gateway
commercial district may also be allowed; this
includes mixed use (including residential)
developments. Parking facilities will serve onsite
uses and are encouraged to explore shared parking
agreements with nearby commercial uses to
encourage a “park once” strategy.
77 Service Commercial
(SC)
Purpose
The Service Commercial designation is intended to
provide adequate space specifically for specialty
goods and services that serve residents and the
region. These businesses often require indoor or
outdoor warehousing or storage space to display or
sell their inventory, and caution is taken to ensure
they are located in a manner that minimizes their
impact on nearby residential, retail, or office uses.

Service Commercial uses often attract customers
for a specific item or service, compared to a
traditional retail district where customers may visit
many businesses within a single trip.

The Service Commercial designation is intended to
provide adequate space specifically for specialty
goods and services that serve residents and the
region. These businesses often require indoor or
outdoor warehousing or storage space to display or
sell their inventory, and caution is taken to ensure
they are located in a manner that minimizes their
impact on nearby residential, retail, or office uses.

Service Commercial uses often attract customers
for a specific item or service, compared to a
traditional retail district where customers may visit
many businesses within a single trip. Occasionally,
mixed use development (including residential uses)
may be appropriately sited.

Service Commercial
Appropriate Land
Uses
The Service Commercial designation is reserved for
the provision of specialty goods and services,
primarily related to home and automotive needs.

Home improvement stores, furniture stores, auto
dealerships, and light automotive service stations
The Service Commercial designation is intended to
provide adequate space specifically for specialty
goods and services that serve residents and the
region. These businesses often require indoor or
outdoor warehousing or storage space to display or

4 PROPOSED AMENDMENTS TO THE GENERAL PLAN LAND USE ELEMENT REQUIRED FOR CONSISTENCY WITH THE 2021-2029 HOUSING ELEMENT
Pg # Section Existing Text Amended Text
are the prioritized use with this designation. Retail
trade and warehousing facilities are allowed as an
accessory use to the primary use.
sell their inventory. Occasionally, residential uses
may be appropriately sited.
77 Creative Light
Industrial
Appropriate Land
Uses
This designation is reserved for the provision of
production uses for light manufacturing, creative
art, or design services. Flexible use spaces, coworking offices, and creative or “maker” industry incubator spaces are also permitted. Professional
office or specialty retail are allowed only as an
accessory in this designation as its intent is to
promote and protect industry and production uses
that diversify the City’s tax base.

This designation is reserved for the provision of
production uses for light manufacturing, creative
art, or design services. Flexible use spaces, coworking offices, and creative or “maker” industry incubator spaces are also permitted. Professional
office or specialty retail are allowed only as an
accessory in this designation as its intent is to
promote and protect industry and production uses
that diversify the City’s tax base. Residential uses,
such as live work and artist space would be
permitted in the Creative Light land use
designation.
78 Public Facilities
Appropriate Land
Uses
Civic-related administrative offices, community
space, operational yards, and educational or
institutional facilities are the primary uses allowed
in this designation. Public utility structures or
corridors, plazas, and historic landmarks or
monuments are also allowed this designation.

Wireless telecommunications facilities may be
allowed in this designation when co-located with
public buildings and determined to be compatible
with and avoid nuisances to surrounding uses.

Civic-related administrative offices, community
space, operational yards, and educational or
institutional facilities are the primary uses allowed
in this designation. Public utility structures or
corridors, plazas, and historic landmarks or
monuments are also allowed this designation.

Wireless telecommunications facilities may be
allowed in this designation when co-located with
public buildings and determined to be compatible
with and avoid nuisances to surrounding uses.

Occasionally, residential uses may be appropriately
sited within such uses as adaptive re-use of facilities or the best use of resources for facilities no longer
in use.

City of Hermosa Beach | Page 1 of 4
Meeting Date: September 10, 2024
Staff Report No. 24-AS-024
Honorable Mayor and Members of the Hermosa Beach City Council

SIDE LETTERS TO THE PROFESSIONAL AND MANAGEMENT EMPLOYEE (PAE)

MEMORANDA OF UNDERSTANDING AND AN AMENDMENT TO THE

UNREPRESENTED GROUP REPORT
(Interim Human Resources Manager Cynthia Stafford)
Recommended Action:

Staff recommends City Council:

1. Approve the Resolution and Side Letter to the Professional and Administrative Employees Memorandum of Understanding (Attachment 1);

2. Approve the Resolution and Side Letter to the Management Employees Group Memorandum of Understanding (Attachment 2); and

3. Approve the Resolution and Amendment to the Unrepresented Group Report (Attachment 3).

Executive Summary:

The City of Hermosa Beach made several organizational changes after the adoption of the Memoranda of Understanding between the City and the Management Employee Group, between the City and the Professional and Administrative Group, and the adoption of the Unrepresented Group Report. These organizational changes necessitate the movement of represented employees between the Bargaining Units and the Unrepresented Group, and from the Unrepresented Group to the Bargaining Units. Additional language is added to clarify existing MOU provisions.

The City met and conferred with the Management Employee Group and the Professional and Administrative Group on these changes. The City and the Management Employee Group and the Professional and Administrative Group reached tentative agreement regarding the changes on August 7, 2024, and August 22, 2024, respectively.

Background:

The Meyers-Milias Brown Act (MMBA) requires that local public agencies negotiate with its respective bargaining units regarding wages, hours, and working conditions. Current Memoranda of Understanding for the two effective Bargaining Units are from July 1, 2022 through June 30, 2025.

The MMBA allows agencies and the recognized employee associations to adopt changes to the MOUs to address emerging issues without impacting the current MOU provisions,

City of Hermosa Beach | Page 2 of 4
in the form of a side letter, assuming the changes were mutually agreed upon and the MOU does not contain a zipper clause1.

The City’s aim through labor negotiations is to maintain competitive wages, hours, and working conditions in a high-cost geographic labor market in order to retain and attract a high-quality workforce to serve the community across a range of services. Periodically, during the term of an MOU, the City makes organizational changes, adds or deletes a classification, or needs to make modifications to MOU provisions to meet the changes and dynamic needs of Hermosa Beach.

Past Council Actions
Meeting Date Description
October 11, 2022 City Council approved the Memorandum of Understanding (MOU) between the City of Hermosa Beach and Professional and Administrative Employee Group (PAE) for the 2022–
2025 fiscal years.

November 3, 2022 City Council approved the terms and conditions of employment for the Unrepresented classifications for the 2022–2025 fiscal years.

December 13, 2022 City Council approved the Memorandum of Understanding (MOU) between the City of Hermosa Beach and the
Management Employee Group for the 2022–2025 fiscal
years
Analysis:

The tentative Side Letters contain the following provisions:

1. Management Employee Group
A. Remove the Human Resources Manager from the Management Employee Group Bargaining Unit and assign the classification to the Unrepresented Group.

B. Retitle the Community Resources Manager to Community Resources Director.

C. Retitle the Finance Director to Administrative Services Director.

D. Amend Article 4, Management Performance Bonus Program, to allow prorating of the bonus if an employee voluntarily leaves the City before the end of the rating period or becomes a member of the Management Employees Bargaining Unit after the start of the rating period.  Prorating the Performance Bonus is at the discretion of the City Manager.

2. Professional and Administrative Group

1 The Public Employment Relations Board defines a zipper clause as a clause in a collective bargaining agreement that permits both parties to refuse to bargain over changes to matters covered by the clause.

City of Hermosa Beach | Page 3 of 4
A. Accrete the Executive Assistant–Chief of Police to the Professional and Administrative Employee Group Bargaining Unit.

B. Remove the Finance Manager from the Professional and Administrative Employee Group Bargaining Unit and assign the classification to the Unrepresented Group.

C. Amend Article 24, Temporary 27, Temporary Upgrade Pay, to add “Employees shall receive a 10% premium pay as compensation for performing the duties.” D. Amend Article 9, Merit Pay Program, to allow prorating of the Merit Pay if an employee voluntarily leaves the City before the end of the rating period or becomes a member of the Professional and Administrative Employee Group Bargaining Unit after the start of the rating period.

3. Unrepresented Group
A. Remove the Executive Assistant–Chief of Police from the Unrepresented Group.

B. Assign the Finance Manager to the Unrepresented Group.

C. Assign the Human Resources Manager to the Unrepresented Group.

D. Amend Temporary Upgrade Pay, to add “Employees shall receive a 10% premium pay as compensation for performing the duties.”
E. Add language that provides a Merit Pay and Administrative Leave provisions for the Human Resources Manager and the Finance Manager.

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.

Policy:
 1.2 Strategic planning. Regularly discuss and set priorities at the City Council and management level to prioritize work programs and staffing needs.

Fiscal Impact:

There is no fiscal impact related to the recommended action.

Attachments:

1. Resolution and Side Letter to the Professional and Administrative Employees Memorandum of Understanding

2. Resolution and Side Letter to the Management Employees Group Memorandum of Understanding

3. Resolution and Amendment to the Unrepresented Group Report Respectfully Submitted by: Cynthia Stafford, Interim Human Resources Manager Noted for Fiscal Impact: Viki Copeland, Administrative Services Director

City of Hermosa Beach | Page 4 of 4
Legal Review: Patrick Donegan, City Attorney
Reviewed by: Angela Crespi, Deputy City Manager
Approved: Suja Lowenthal, City Manager

CITY OF HERMOSA BEACH
RESOLUTION NO. 24-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA

BEACH, CALIFORNIA, ADOPTING A SIDE LETTER TO THE

MEMORANDUM OF UNDERSTANDING WITH THE PROFESSIONAL AND
ADMINISTRATIVE EMPLOYEE GROUP.

WHEREAS, employees of the City of Hermosa Beach, California represented by the Profession and Administrative Employee Group, have elected to meet and confer with the City of Hermosa Beach on matters concerning wages, hours, and working conditions; and, WHEREAS, the Employee Association and City of Hermosa Beach Chief Labor Negotiator have jointly negotiated changes to the Memorandum of Understanding; and, WHEREAS, the Employee Association and City of Hermosa Beach Chief Labor Negotiator have mutually agreed to recommend that the City Council adopt these changes to the Memorandum of Understanding.

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

SECTION 1. The City Council of the City of Hermosa Beach has a Memorandum of Understanding for the period July 1, 2022, through and including June 30, 2025.

SECTION 2. The City of Hermosa and the Profession and Administrative Employees Group desire to enter into a Side Letter to amend the Memorandum of Understanding for the period July 1, 2022, through and including June 30, 2025, as shown on Exhibit A.

SECTION 2. This resolution takes effect immediately and that the City Clerk shall certify to the passage and adoption of this resolution; shall cause the same to be entered among the original resolutions of said City; and shall make a minute of the passage and

adoption thereof in the records of the proceedings of the City Council of said City in the minutes of the meeting at which time same is passed and adopted.

PASSED, APPROVED and ADOPTED on this 10th day of September, 2024.

Dean Francois
PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, CA ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Myra Maravilla Patrick Donegan
City Clerk City Attorney

EXHIBIT A

SIDE LETTER AGREEMENT BETWEEN

THE CITY OF HERMOSA BEACH
AND

PROFESSIONAL AND ADMINISTRATIVE EMPLOYEES GROUP
Whereas, the City of Hermosa (“City”) and the Professional and Administrative Employee Group (“Union”) are parties to a Memorandum of Understanding dated July 1, 2022 – June 30, 2025 (“MOU”);
Whereas, following the adoption of the executed MOU, the City reorganized, necessitating changes to classifications represented by the Professional and Administrative Employees Group.

Whereas, the parties met and conferred on the proposed changes and the Management Employee Group agreed to the changes on August 22, 2024.

Now, therefore, having met and conferred in good faith, the City and Union agree to the following changes:

1. Accrete the Executive Assistant-Chief of Police to the Professional and Administrative Employee Group bargaining unit.

2. Remove the Finance Manager from the Professional and Administrative Employee Group Bargaining Unit and assign the classification to the unrepresented group.

3. Amend Article 24, Temporary 27, Temporary Upgrade Pay, to add “Employees shall receive a 10% premium pay as compensation for performing the duties.”

4. Amend Article 9, Merit Pay Program, to Prorate the Merit Pay if an employee voluntarily leaves the City before the end of the rating period or becomes a member of the Professional and Administrative Employee Group Bargaining Unit after the start of the rating period.

All other Articles, provisions, Sections, and Exhibits of the MOU not modified herein shall remain in full force and effect.

The parties hereto have caused their duly authorized representatives to execute this Side Letter Agreement effective September 1, 2024.

IN WITNESS WHEREOF, the parties hereto cause this Side Letter Agreement to be effective this 1
st day of September 2024.

PROFESSIONAL AND ADMINISTRATIVE

EMPLOYEE GROUP

CITY OF HERMOSA BEACH
________________________________ _________________________________ Vicky Barker,
City Employees Associates
Suja Lowenthal, City Manager
________________________________ _________________________________ Kambria Vint, Recreation
Coordinator
Viki Copeland, Administrative
Services Director
_________________________________ ___________________________________ John Cordova, Public Works
Superintendent
Cynthia Stafford, Interim Human
Resources Manager
_________________________________ ___________________________________ Kim Swindell, Administrative
Assistant
Angela Crespi, Deputy City
Manager

CITY OF HERMOSA BEACH
RESOLUTION NO. 24-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA

BEACH, CALIFORNIA, ADOPTING A SIDE LETTER TO THE

MEMORANDUM OF UNDERSTANDING WITH THE MANAGEMENT
EMPLOYEE GROUP.

WHEREAS, employees of the City of Hermosa Beach, California represented by the Management Employee Group, have elected to meet and confer with the City of Hermosa Beach on matters concerning wages, hours, and working conditions; and, WHEREAS, the Employee Association and City of Hermosa Beach Chief Labor Negotiator have jointly negotiated changes to the Memorandum of Understanding; and, WHEREAS, the Employee Association and City of Hermosa Beach Chief Labor Negotiator have mutually agreed to recommend that the City Council adopt these changes to the Memorandum of Understanding.

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

SECTION 1. The City Council of the City of Hermosa Beach has a Memorandum of Understanding for the period July 1, 2022, through and including June 30, 2025.

SECTION 2. The City of Hermosa and the Management Employees Group desire to enter into a Side Letter to amend the Memorandum of Understanding for the period July 1, 2022, through and including June 30, 2025, as shown on Exhibit A.

SECTION 2. This resolution takes effect immediately and that the City Clerk shall certify to the passage and adoption of this resolution; shall cause the same to be entered among the original resolutions of said City; and shall make a minute of the passage and adoption thereof in the records of the proceedings of the City Council of said City in the minutes of the meeting at which time same is passed and adopted.

PASSED, APPROVED and ADOPTED on this 10th day of September, 2024.

Dean Francois
PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, CA ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Myra Maravilla Patrick Donegan
City Clerk City Attorney

EXHIBIT A

SIDE LETTER AGREEMENT BETWEEN

THE CITY OF HERMOSA BEACH
AND

MANAGEMENT EMPLOYEE GROUP
Whereas, the City of Hermosa (“City”) and the Management Employee Group (“Union”) are parties to a Memorandum of Understanding dated July 1, 2022 – June 30, 2025 (“MOU”);
Whereas, following the adoption of the executed MOU, the City reorganized, necessitating changes to classifications represented by the Management Employee Group.

Whereas, the parties met and conferred on the proposed changes and the Management Employee Group agreed to the changes on July 24, 2024.

Now, therefore, having met and conferred in good faith, the City and Union agree to the following changes:

1. Remove the Human Resources Manager from the Management Employee Group Bargaining Unit and assign the classification to the unrepresented group.

2. Retitle the Community Resources Manager to Community Resources Director.

3. Retitle the Finance Director to Administrative Services Director.

4. Effective 7/1/2022, the Performance Bonus may be prorated if an employee voluntarily leaves the City before the end of the rating period or becomes a member of the Management Employees Bargaining Unit after the start of the rating period. Prorating the Performance Bonus is at the discretion of the City Manager.

All other Articles, provisions, Sections, and Exhibits of the MOU not modified herein shall remain in full force and effect.

The parties hereto have caused their duly authorized representatives to execute this Side Letter Agreement effective September 1, 2024.

IN WITNESS WHEREOF, the parties hereto cause this Side Letter Agreement to be effective this 8th day of August 2024.

MANAGEMENT EMPLOYEE GROUP CITY OF HERMOSA BEACH
________________________________ _________________________________ Viki Copeland,
Administrative Services Director
Suja Lowenthal, City Manager
________________________________ _________________________________ Angela Crespi, Deputy City Manager Cynthia Stafford, Interim Human Resources Manager
_________________________________
Lisa Nichols, Community Resources
Director
_________________________________
Paul LeBaron, Chief of Police
___________________________________
Joseph SanClemente, Public Works
Director
__________________________________
Myra Maravilla, City Clerk
___________________________________
Carrie Tai, Community Development
Director

CITY OF HERMOSA BEACH
RESOLUTION NO. 24-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERMOSA

BEACH, CALIFORNIA, APPROVING SALARY AND BENEFITS FOR
EMPLOYEES IN UNREPRESENTED CLASSIFICATIONS.

WHEREAS, the City of Hermosa Beach, California has employees in certain unrepresented classifications; and,
WHEREAS, the City of Hermosa Beach shall establish a formal document to detail salary and benefits of employees in unrepresented classifications of employment; and, WHEREAS, the City of Hermosa Beach intends to make changes to the existing terms of employment for unrepresented classifications effective September 10, 2024.

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

SECTION 1. The City Council of the City of Hermosa Beach resolves to approve the amended salary and benefits for unrepresented classifications as outlined in the attached “Exhibit A” effective September 10, 2024.

SECTION 2. This resolution takes effect immediately and that the City Clerk shall certify to the passage and adoption of this resolution; shall cause the same to be entered among the original resolutions of said City; and shall make a minute of the passage and adoption thereof in the records of the proceedings of the City Council of said City in the minutes of the meeting at which time same is passed and adopted.

PASSED, APPROVED and ADOPTED on this 10th day of September 2024.

Dean Francois
PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, CA ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Myra Maravilla Patrick Donegan
City Clerk City Attorney

1 EXHIBIT A
City of Hermosa Beach
Salary and Benefits for Unrepresented Classifications

THE FOLLOWING SALARY AND BENEFIT PROVISIONS APPLY TO EMPLOYEES

IN THE UNREPRESENTED CLASSIFICATIONS OF HUMAN RESOURCES

MANAGER, HUMAN RESOURCES ANALYST, RISK MANAGEMENT ANALYST,

FINANCE MANAGER, AND EXECUTIVE ASSISTANT TO THE CITY MANAGER WAGES
 Year 1: July 1, 2022 – June 30, 2023: Effective July 1, 2022: The base monthly salary shall be adjusted by 3% for all classifications.

Monthly Salary Range
TITLE Step 1 Step 2 Step 3 Step 4 Step 5
Executive Assistant to the City Manager $6,974 $7,323 $7,689 $8,073 $8,477 Human Resources Analyst $7,195 $7,555 $7,933 $8,330 $8,747 Risk Management Analyst $7,195 $7,555 $7,933 $8,330 $8,747  Year 2: July 1, 2023 – June 30, 2024: Effective July 1, 2023 the base monthly salary shall be adjusted by 3% for all classifications.

Monthly Salary Range
TITLE Step 1 Step 2 Step 3 Step 4 Step 5
Executive Assistant to the City Manager $7,183 $7,542 $7,919 $8,315 $8,731 Human Resources Analyst $7,411 $7,781 $8,170 $8,579 $9,009 Risk Management Analyst $7,411 $7,781 $8,170 $8,579 $9,009  Year 3: July 1, 2024 – June 30, 2025: Effective July 1, 2024, the base monthly salary shall be adjusted by 3% for all classifications.

Monthly Salary Range
TITLE Step 1 Step 2 Step 3 Step 4 Step 5
Executive Assistant to the City Manager $7,399 $7,769 $8,157 $8,565 $8,993 Human Resources Analyst $7,633 $8,015 $8,416 $8,837 $9,279 Risk Management Analyst $7,633 $8,015 $8,416 $8,837 $9,279 Human Resources Manager $12,143 $12,750 $13,388 $14,057 N/A Finance Manager $9,916 $10,412 $10,933 $11,480 $12,054

2  Step increase is dependent upon employee receiving an overall performance evaluation of being fully qualified.

EDUCATIONAL ALLOWANCE
A. City agrees that employees who desire to enroll in training and/or academic courses at a State of California approved and/or recognized college or university that may provide the Employee with general or specific skills and/or knowledge that contributes to their ability to perform their current position or enhances promotional opportunities shall have their course fees, books and tuition (up to CSU rates) paid by the City in advance, subject to approval of the City Manager.

The Employee will reimburse the City for all expenses incurred for any class or classes the Employee fails or does not complete; or if the Employee voluntarily leaves City employment during the period they are enrolled and received payment.

B. Reimbursement of tuition shall be on a pro-rated basis depending upon the number of hours an Employee covered by this Agreement is normally scheduled to work (i.e. full time @ 100% reimbursement, up to CSU rates; half time @ 50% reimbursement, etc.).

VACATION
A. It is agreed that the above unrepresented classifications shall accrue vacation as follows:

Years of Service Accrued Per Year
* Probation Period 1st Year 80 hours
Commencing with 2nd Year 80 hours
“ “ 4th Year 96 hours
“ “ 6th Year 112 hours
“ “ 10th Year 128 hours
“ “ 14th Year 144 hours
“ “ 18th Year 160 hours
B. Employees may request (subject to Department Director’s approval) one (1) week of vacation six (6) months after hire date (after halfway point of probationary period).

C. Vacation may be accrued up to thirty (30) month accrual level, with an automatic cash-out of hours in excess of that amount. The cash outs will take place based on the accrual balance of November 16th and paid on the check of December 5th.

D. Employees shall be reimbursed for 100% unused vacation days accrued upon resignation, retirement or imposed termination from their employment with the City.

3 OVERTIME
A. For FLSA purposes a "WORK-WEEK" shall be defined as:

1. For employees working a 5/40 or 4/40 schedule: commencing at 0001 hrs. SUNDAY and terminating at 2400 hrs. SATURDAY.

2. For employees working a 9/80 schedule: commencing 1101 hrs.

Friday and terminating the following Friday at 1100 hrs.

B. The City agrees to pay employees in the following classifications time and one-half (1-1/2) the regular rate of pay for all hours worked in excess of forty (40) hours worked in a work week. Overtime may be paid in either cash or compensatory time earned as part of the regular payroll process. The City will pay overtime to employees in eligible classifications in the same manner as paid to the General & Supervisory Employees Association.

C. Employees may elect to cash-in accrued compensatory time quarterly each calendar year in January, April, July, and October.

D. Classifications eligible for overtime compensation in accordance with the FLSA include:

Human Resources Analyst
Executive Assistant to the City Manager
Risk Management Analyst

EXEMPTIONS FROM THE FLSA
A. The following classifications have been determined to be exempt from overtime as defined in the Fair Labor Standards Act (FLSA) and as FLSA applies to public agency employees. As such, these classifications shall not be eligible to accrue compensatory time or be paid overtime.

Human Resources Manager
Finance Manager
B. Administrative Leave: Employees in the exempt classifications listed above shall receive seventy (70) hours of additional Administrative Leave each calendar year in addition to flex time for extraordinary assignments, fixed holidays, vacation, and Bereavement Leave. Administrative Leave does not accumulate or carry over; it must be used each year. Said leave shall have no monetary value and shall be prorated for partial years’ service upon initial appointment.

4 SICK LEAVE
A. Effective July 1, 2022, employees shall accrue sick leave at the rate of ten (10) hours per month. After 200 hours are accrued, an employee may cash out annually up to a maximum of 96 hours at the employee’s regular rate of pay at 100% rate. In lieu of cash out, employees may convert up to a maximum of 96 hours to vacation time provided that the vacation bank does not exceed allowed maximum level. The cash outs will take place based on the accrual balance of November 16th and paid on the check of December 5th.

B. Sick leave shall be used only in case of sickness or disability of the employee or for family sick leave. Misuse of sick leave shall be grounds for disciplinary action.

C. In case of serious illness of a member of the immediate family, the employee may utilize sick leave. Immediate family for the purpose of this Section shall be defined as: spouse, child, stepchild, parent, stepparent, parent-in-law, brother, sister, grandparents, grandchildren, any relative not previously listed who lives in the same household as the employee, and a domestic partner of the employee.

D. Any employee claiming a domestic partner, for purposes of this Agreement shall complete a confidential affidavit to be filed in the Human Resources Department, which shall be signed by the employee only, declaring the existence of a domestic partnership with a named domestic partner. By extending to a domestic partner employee the specific benefits defined by this Agreement, the City does not intend to confer or imply any other unspecified benefits to such employee, or to any other person who may hold the status of domestic partner.

E. Employees may, upon resignation or retirement from their employment with the City, elect to be paid for unused sick leave accrued prior to June 30, 2017, at their current rate of pay. Except as provided in A above, unused sick leave accrued after June 30, 2017, shall not be cashed out. Pursuant to Government Code § 20965, related CalPERS, rules and the City’s contract with CalPERS, upon retirement from City employment, an employee’s unused accumulated sick leave at the time of retirement may be converted to additional service credit.

F. Employees shall be eligible to use sick leave during their probationary period.

BEREAVEMENT LEAVE
Each Employee shall receive a maximum of three (3) shifts per calendar year to be utilized for Bereavement Leave because of a death in their immediate family (as defined above).

For the purposes of bereavement leave, parent in-law, step-children and parents, and persons living within the same household are to be considered in the definition of “immediate family”. Said time will not be cumulative from one twelve month period to another nor will pay in lieu of unused leave be provided. The Department Director shall, if

5 possible, grant approval of two (2) additional shifts in the event of a death that requires extended travel.

JURY DUTY
If called for jury duty in a Municipal, Superior, or Federal Court, or for a Coroner’s Jury, Employees covered by this Agreement shall remain in their regular pay status in accordance with the City’s Administrative Policy on Jury Pay. All jury fees except mileage reimbursement shall be returned to the City.

MILITARY LEAVE
All Employees covered by this Agreement shall be entitled to Military Leave as afforded by Federal and State law but shall not receive any base salary pay while on such Leave.

HOLIDAYS
A. Effective July 1, 2022, employees shall receive 110 hours per year for the following holidays off with pay: New Year’s Day; Martin Luther King, Jr.’s Birthday; President’s Day; Cesar Chavez Day; Memorial Day; Juneteenth; Independence Day; Labor Day; Veterans Day; Thanksgiving Day; Christmas Day.

B. When a holiday falls on a normal day off, Employees shall receive Holiday Compensation Time. Employees covered by this Agreement may accrue up to 100 hours of Holiday Compensation Time for those holidays in which compensatory time is earned. However, when a holiday falls on a Sunday, it will be observed on the following Monday. For all holidays that fall on a Friday or Saturday, City Hall offices will be open regular hours on Monday and employees will receive compensatory time. The City will provide a holiday schedule prior to January 1 of each year.

C. All employees covered by this Resolution, will receive ten (10) hours of Holiday Flex Time for the following purpose: these ten hours can only be used for either Christmas Eve (December 24th) or New Year’s Eve (December 31st). The hours may also be split into two days, using 5 hours each day (applies to Christmas Eve and New Years’ Eve only). Taking into consideration the employee’s preference, Department Directors will coordinate such leave to ensure there is adequate coverage for the department.

RETIREMENT
A. Tier I. The City provides the PERS 2% at 55 Plan with one year final compensation to current employees. The City paid the employee’s full 7% contribution to PERS through December 31, 2012. The City reported to P.E.R.S. the value of the 7%

6 employer paid member contribution (EPMC) pursuant to the authority of Government Code section 20023(c)(4).

Tier II. For new employees hired after July 2011 the PERS retirement benefit formula shall be the 2% @ 60 plan, with retirement benefits calculated on one year final compensation. This became effective once a new contract with PERS was signed. The City paid the employee’s 7% contribution to PERS. The City reported to P.E.R.S. the value of the 7% employer paid member contribution (EPMC) pursuant to the authority of Government Code section 20023(c)(4).

Member contribution: Each employee in the bargaining unit shall pay the full seven percent (7%) PERS member contribution by payroll deduction as follows:

1. Effective January 1, 2013, by 2.5%

2. Effective July 1, 2013, an additional 2.5% for a total of 5%.

3. Effective July 1, 2014, an additional 2% for a total of 7%.

4. The City shall adopt the necessary resolution so that such payments made by the employees may be excluded from taxable income pursuant to section 414(h)(2) of the U.S. Internal Revenue Code.

Tier III. Employees hired on or after January 1, 2013, shall be subject to the Public Employee Pension Reform Act, (“PEPRA”; Assembly Bill 340) including but not limited to:

1. 2% at 62 retirement formula for those who are “new members” as that term is defined in AB 340.

2. Such new members shall pay to PERS by payroll deduction 50% of the “normal cost” as defined in AB 340 or the then current contribution rate of similarly situated employees, whichever is greater, as required by new Government Code section 7522.30(c).

B. Effective November 1, 1995, the City shall commence reporting to PERS the value of the Employer Paid Member Contribution (EPMC) pursuant to the authority of Government Code.

C. The City amended its contract with PERS to offer the retirement formula known as 2% @ 55 effective January 1, 2001.

D. Employees who retire after July 1, 2006 and were hired before July 1, 2018 shall be eligible, upon service retirement from the City, for a medical premium supplement. Said supplement shall be in the following amount:

7 1. The City will contribute 5% of the health insurance premium for each year of service with the City of Hermosa Beach up to the lesser of the single person lowest costing HMO premium or $500 per month. A retiring employee must have completed a minimum of ten (10) years of service with the City of Hermosa Beach and be at least fifty-five (55) years of age to be eligible for this benefit.

2. Said supplement shall commence with the first month following the Employee’s service retirement in which the Employee is responsible for payment of the insurance premium.

3. In order to be eligible for medical supplemental payments, an Employee must either remain on a medical insurance plan offered by the City or provide proof of coverage on a self-procured medical insurance plan.

4. Retirees who are eligible for a supplement but who are not covered on the City’s insurance policy are still eligible to receive their supplement.

Payments will only be made when the retiree provides proof of coverage of insurance and proof of the amount paid for said coverage. Proof of coverage and the amount paid must be provided to the City within 60 days.

The City will not provide retroactive reimbursement for payments not documented within 60 days of payment.

5. Any Employee receiving a benefit under this section agrees to apply for, and enroll in, any Federal and/or State medical insurance plan (e.g.

Medicare, Medicaid) for which they become eligible.

E. Employees who are hired after July 1, 2018 shall be eligible, upon service retirement from the City at age sixty (60) with a minimum of twenty (20) continuous City service, for a medical premium supplement. Said supplement shall be paid as follows:

1. The City shall pay a $400.00 per month medical supplement that shall commence with the first month following the Employee’s service retirement in which the Employee is responsible for payment of the insurance premium.

2. The City’s payments will end with the month in which the employee reached the eligibility of Federal and/or State medical insurance plans (i.e.

Medicare), currently 65 years of age.

HEALTH AND WELFARE
A. The City will have full responsibility for all Health and Welfare programs enacted or in force as of September 1, 1997.

8 B. The City shall make available for employees the following insurance plans:

Health, Dental, Long Term Disability, Vision and Psychological Health. Current Health, Dental, Long Term Disability, Vision, Psychological Health, or their equivalent, to remain in force during the term of this Resolution. City shall meet and confer should there be a change in providers or a change in benefit level.

C. For life insurance, the City shall provide and pay the premiums for a Life Insurance policy for each Employee, payable in an amount equal to the individual’s annual salary upon such Employee’s death.

D. For long term disability insurance, the City will provide and pay the premiums for Long Term Disability for each employee.

E. For medical/health insurance, for the benefit years beginning January 1, 2023 and later, the City’s maximum contribution toward medical insurance for each employee’s selected plan and level of coverage will be $1,875.39. Employees choosing a medical insurance plan and/or coverage level with a monthly premium that exceeds the City’s maximum contribution shall pay the difference by payroll deduction.

F. An employee who demonstrates proof of medical insurance coverage available through a spouse or domestic partner may receive a cash payment of $750.00 per month in lieu of City provided coverage.

G. For dental insurance, the City shall pay the monthly premium contribution for full family PPO coverage for dental insurance, currently $226.30.

H. For psychological health, the City will continue to pay for full family coverage for the benefit.

I. The full cost of the Vision Insurance shall be borne by the employee.

J. The City’s Short Term Disability Plan begins after a 30 day waiting period. The maximum benefit is 66 2/3% of your earnings to a maximum of $1125 per week.

The City’s Long Term Disability Plan has a maximum benefit of $4500 per month and begins after 90 days.

LONG TERM DISABILITY
A. An Employee utilizing the Short or Long Term Disability Plan shall not accrue Vacation, Sick Leave, Holiday Pay or allowances after the 30th calendar day after disability.

9 B. FAMILY AND MEDICAL CARE LEAVE

1. As required by State and Federal law, the City will provide Family and Medical Care Leave for eligible Employees. The following provisions set forth unit members’ rights and obligations with respect to such Leave.

Rights and obligations which are not specifically set forth below are set forth in the Department of Labor regulations implementing the Federal Family and Medical Leave Act of 1993 ”FMLA”), and the regulations of the California Fair Employment and Housing Commission implementing the California Family Rights Act (“CFRA”) (Government Code §12945.2).

Unless otherwise provided by this Article, “Leave” under this article shall mean Leave pursuant to the FMLA and CFRA.

2. Eligible Employees are entitled to a total of 12 weeks of Leave during any 12-month period. An Employee’s entitlement to Leave for the birth or placement of a child for adoption or foster care with the Employee expires 12 months after the birth or placement.

3. The 12-month period for calculating Leave entitlement will be a “rolling period” measured backward from the date Leave is taken and continues with each additional Leave day taken. Thus, whenever a member requests Leave, the City will look back over the previous 12-month period to determine how much Leave has been used in determining how much Leave a member is entitled to.

4. If an Employee uses Leave for any reason permitted under the law, he/she may concurrently utilize all other accrued Leaves in connection with the Leave. The utilization of other accrued Leaves will run concurrently with the Leave.

5. Employees must fill out the following applicable forms in connection with Leave under this article:
 “Request for Family or Medical Leave”
 “Certification of Physician or Practitioner”
 “Fitness for Duty to Return from Leave”

6. The provision of Article 21 (A) shall apply regarding the accrual of Vacation, Sick, Holiday Pay and allowances with the exception that seniority shall continue to accrue during the period of FMLA leave.

DEFERRED COMPENSATION
A. Each Employee, individually, may elect to participate in the Deferred Compensation Plans established and adopted by the City of Hermosa Beach.

10 B. Upon the first pay period after Council adoption of this Resolution, the City shall match the employee’s contribution up a maximum of twenty-five dollars ($25) per month.

LAYOFF
A. It is mutually agreed that whenever, in the judgment of the City Council, it becomes necessary to abolish a position in the interest of economy or because the necessity for the position no longer exists, the City Council may abolish any position or employment in the competitive service and the personnel officer shall layoff, demote or transfer Employees thereby affected.

B. The criterion used in determining the order of separation shall be seniority, pursuant to the Municipal Code, Chapter 2.76 – Civil Service.

C. The City will endeavor to provide each affected Employee as much notice as possible, with a minimum thirty (30) day advance notice to each affected Employee.

REDUCTION IN LIEU OF LAYOFF
An Employee whose position is abolished shall be governed by Municipal code 2.76.200 – Civil Service.

SELECTION OF INDUSTRIAL ACCIDENT DOCTOR OR MEDICAL FACILITY AND

CONTINUATION OF HEALTH BENEFITS
A. It is understood that the City will provide medical facilities to be used for industrial accidents or illness. However, in the event an Employee covered by this Agreement wishes to grieve the City’s selection, the City will give due consideration to the facts presented and may select a new facility.

B. An Employee who suffers an injury-on-duty will continue to have payment of the City portion of all Health Insurance premiums paid for a period of seven (7) full months commencing with the month in which the injury occurred.

C. Nothing herein shall prevent an Employee from utilizing their accrued time in lieu of receiving temporary disability payments under the provisions of the Workers’ Compensation laws of the State of California.

GRIEVANCES/APPEAL OF DISCIPLINE
This Grievance Procedure shall be used to resolve disputes arising from any allegation that the City has violated the terms of this Resolution.

11 A. The complaint shall be presented in writing to the Department Director. The Director shall have five (5) working days of receipt of the complaint to resolve the issue or respond to it in writing stating the reasons for the failure to resolve it.

B. If not resolved, the complaint shall be presented in writing to the City Manager.

The City Manager shall have five (5) working days of receipt of the complaint to resolve the issue or respond to it in writing stating the reasons for the failure to resolve it. C. If disciplinary actions concerning dismissals, suspensions, reduction in pay, etc. are not resolved, further action is pursuant to Municipal Code, Section

2.76 – Civil Service.

C. Grievances regarding the provisions contained within this resolution, with the exception of disciplinary actions, not settled following the City Manager’s determination and that either party desires to contest further, may be submitted to arbitration as provided in this article provided however that said Request for Arbitration shall be made within twenty (20) calendar days of the City Manager’s determination
D. As soon as possible and in any event not later than fourteen (14) calendar days after either party received written notice from the other of the desire to arbitrate, the parties shall agree upon an arbitrator. If no Agreement is reached within said fourteen (14) calendar days, an arbitrator shall be selected from a list of seven (7) arbitrators submitted by the Federal Mediation and Conciliation Service by alternate striking of names until one name remains. The party who strikes the first name from the panel shall be determined by lot.

E. Either the City or the Employee may call any employee as a witness, and the City agrees to release said witness from work if he/she is on duty.

F. The arbitrator shall have no power to alter, amend, change, add to or subtract from any of the terms of this resolution. The decision of the arbitrator shall be based solely upon the evidence and arguments presented to him by the respective parties in the presence of each other.

G. The decision of the arbitrator within the limits herein prescribed shall be advisory only.

H. The arbitrator may hear and determine only one grievance at a time without the express agreement of the City and employee. The parties shall share equally the expense of the cost of the arbitration, with the exception of counsel's fees.

OUT OF CLASS PAY
Employees covered by this Agreement who are temporarily assigned to a higher classification because of emergency conditions, Sick Leave, Vacation and/or vacancy shall receive the higher rate of pay commencing with the eleventh (11th)

12 consecutive day of such assignment. Employees shall receive a 10% premium pay as compensation for performing the duties.

MERIT PAY
The following Unrepresented Employees will be eligible to receive Merit Pay for superior performance: Finance Manager and Human Resources Manager. Said bonus pay will be up to a maximum of +5% of base monthly pay payable for six-month (bi-annual) increments. The two bi-annual periods are July 1 – December 31 and January 1 – June

30. In order for an employee to receive Merit Pay, the Department Director and employee shall agree to specific goals to achieve for each bi-annual period. At the end of the reporting period, the employee shall provide a detailed outline of the goals that have been met. Based on this documentation, the Director shall determine if the employee is eligible for the Merit Pay, either in full (5%) or a lesser amount. Achieving any of the goals equates to performance over and above standard performance and is recognized as superior performance as it relates to these goals. The Bonus Pay will be included in the pay period following the period that is being evaluated provided that the detailed outline of goals met is received in a timely manner. The parties understand that bonus pay in these amounts is reportable to the California Public Employees Retirement System (CalPERS) as employee compensation and thus be “PERSable” to the extent permissible by law.
5% Superior Performance Bonus (employee met nearly 100% of the goals) 4% Superior Performance Bonus (employee met at least 80% of the goals) 3% Superior Performance Bonus (employee met at least 60% of the goals) 2% Superior Performance Bonus (employee met at least 40% of the goals) 1% Superior Performance Bonus (employee met at least 20% of the goals) The Performance Bonus may be prorated if an employee voluntarily leaves the City before the end of the rating period or becomes a member of the Unrepresented Group after the start of the rating period. Prorating the Performance Bonus is at the discretion of the City Manager.

For salary comparison purposes, base salary shall be increased by 3.75% (75% of maximum Bonus Pay) to adjust for Bonus Pay eligibility for those classes eligible. Commented [HC1]: Added per discussion & approval with Cyndi to match the language in the PAE MOU.

City of Hermosa Beach | Page 1 of 6
Meeting Date: September 10, 2024
Staff Report No. 24-CDD-048
Honorable Mayor and Members of the Hermosa Beach City Council DISCUSSION OF UPDATING THE CITY’S PARKING IN-LIEU FEE
(Community Development Director Carrie Tai)
Recommended Action:

Staff recommends City Council:

1. Discuss a possible increase to the City’s parking in-lieu fees to reflect the true cost of providing additional parking; and

2. Provide staff direction on parking in-lieu fees, annual escalation, and criteria for evaluating requests.

Executive Summary:

The City’s in-lieu parking fees were last updated in 2006 setting the current fee at $28,900 per stall. Staff obtained an appraisal in 2022 recommending a fee update and, in 2024, obtained a peer review of the appraisal. Staff recommends City Council discuss a possible update to the City’s parking in-lieu fee and provide direction to City staff regarding an annual escalation and evaluation criteria. Staff would return to City Council at a future meeting to present any desired program modifications.

Background:

In 1985, the City adopted Resolution 85-4875 (Attachment 5) creating a parking in-lieu program allowing payment of fees in-lieu of providing required parking downtown, which is in the Coastal Zone. The in-lieu fee was intended to enable the City to create additional public parking opportunities to supplement development projects that do not provide parking on-site. The fee was subsequently updated by Resolution 99-6001 (Attachment 6) in 1999 and Resolution 06-6487 (Attachment 7) in 2006. When initially adopted, the fee included an annual Consumer Price Index adjustment. Subsequent updates did not include any annual adjustments. The in-lieu fee has been $28,900 per parking stall since 2006.

In evaluating the application for a hotel conversion at 66 11th Street in December 2021, the Coastal Commission indicated that the City’s parking in-lieu fee was no longer adequate to fund additional parking opportunities. An excerpt from that staff report reads, “Since 2000, the City has accepted in-lieu fees for a total of 23 parking spaces (i.e. 23 off-street parking space requirements were waived for various Hermosa Beach projects in the past 21 years). Nonetheless, in discussion between City and Commission staff

City of Hermosa Beach | Page 2 of 6
regarding the in-lieu fees, City staff acknowledged that the City does not currently have a clear program to use in-lieu fees to construct or acquire new parking, nor is it clear that the fees are adequate. However, the City has committed to work with Commission staff to reevaluate the adequacy of the fees and develop a program to determine how to use the fees to provide full replacement for parking not provided on-site. However, the construction of new public parking lots or additional on-street parking requires a considerable amount of time for planning and land acquisition—it may take several years, even decades, for the currently proposed in-lieu fees to provide actual, available parking spaces in the vicinity of the project site that will mitigate for the lack of parking provided to meet the demands of the proposed project.”
In a letter dated December 2, 2021, the City informed the Coastal Commission of its commitment to reevaluating the parking in-lieu fee (Attachment 1).

Past Board, Commission, and Council Actions
Meeting Date Description
September 24, 1985 City Council adopted Resolution 85-4875, creating a parking in-lieu fee of $6,000 with annual increases.

June 8, 1999 City Council adopted Resolution 99-6001, increasing the parking in-lieu fee to $12,500.

September 12, 2006 City Council adopted Resolution 06-6487, increasing the parking in-lieu fee to $28,900, the current amount.

Discussion:

Fee Study Update
To assess an updated parking in-lieu fee, the City must study land cost, the cost of adding new parking facilities, and locations/configurations of potential opportunities to create parking facilities.

In December 2022, the City secured the services of Integra, an appraisal company, to assess the City’s in-lieu parking program and recommend an appropriate fee amount.

The Integra report (Attachment 3) estimated land cost to be $600 per square foot, each parking stall occupying 310 square feet of land area, and the cost of a parking stall based on the land and construction costs of a theoretical parking five-story parking structure.

The Integra report indicated that a parking in-lieu fee up to $70,000 per stall was justified but recommended the City consider a 50 percent reduction to remain within the range of other cities’ fees and also encourage development.

In May 2024, given the rapid change in interest rates, inflation, and real estate prices, the City secured the services of Kosmont Companies, Inc, to perform a peer review and validate the analysis prepared by Integra. Kosmont Companies found that the land cost used by Integra reflected actual conditions, but that any theoretical parking structure

City of Hermosa Beach | Page 3 of 6
constructed Hermosa Beach would be three stories instead of five, and that configuration challenges would likely result in a slightly more land needed for each parking stall. These adjustments, using the same land value at $600 per square foot, results in an approximate parking stall cost of $113,000.

In-Lieu Parking Space Inventory
When the City constructed the parking structure known as “Lot C,” 100 parking spaces were allocated for use as future in-lieu parking spaces. The City was charged with maintaining an inventory of the spaces. To date, 75 spaces are allocated for in-lieu parking use, and 25 remain. The inventory is included as Attachment 2.

Parking Requirements
The City’s parking requirements in the Coastal zone are generally flexible in allowing changes of use that may result in land use intensification, which would increase in the parking requirement. In 2021, the City updated the Zoning Ordinance to formalize a practice of not requiring additional parking from changes of use.

This Zoning Ordinance change is not approved by the Coastal Commission; as such, the Coastal Commission may independently impose parking requirements (or allow in-lieu parking) as part of the Coastal Development Permit process, as has occurred in the past.

For example, the office development at 906–910 Hermosa was allowed by the City’s local approval to pay parking in-lieu fees for seven spaces; however, the Coastal Development Permit required the payment of parking in-lieu fees for 16 spaces. This decreased the available inventory by nine additional spaces.

Updates to Applicable Criteria for Parking In-Lieu Requests Since there are only 25 parking spaces remaining for parking space allocation, staff recommends review of criteria to determine which projects should be given priority consideration for parking in-lieu spaces. The spaces are currently requested on a firstcome, first-served basis, through a Parking Plan presented to the Planning Commission.

The current challenge is that projects requesting parking in-lieu space may not necessarily be projects that further the City’s vision. Thus, development of criteria to prioritize projects for parking in-lieu space consideration would increase the City’s ability to attract and incentivize preferred types of development in the downtown area. As previously mentioned, another consideration for parking in-lieu spaces is the Coastal Commission’s ability to approve a different number of parking in-lieu spaces from a project’s approval.

The Coastal Zone Parking Management Study prepared in 2019 recommended a potential zoning code revision to “allow for in-lieu fees to contribute more towards on-site parking requirements to improve development and tenant flexibility to produce contextsensitive design. This would allow property owners to consider a greater reduction in onsite spaces. Revenue from fees should continue to be used to fund the shared parking

City of Hermosa Beach | Page 4 of 6
supply.” This alludes to the possibility of private-public partnerships where private development could include publicly available parking spaces.

Comparison of Other Cities’ Fees
The Integra report also included a survey of other cities for parking in-lieu fees. Staff also conducted a supplemental survey to include more recent updates. While this survey is informative for context purposes, it does not consider variations in land use, intensity, existing development and availability of parking, or development potential.

Jurisdiction In-Lieu Fee (per space) Year Notes
Manhattan Beach $20,363 1991 If over 20 spaces, requires City Council approval.

Huntington Beach $32,126 2010 3% increase every year. $32,126 until Sept 30th.

Beverly Hills $54,774–Rodeo Drive
$43,819–Beverly Drive
$32,959–Other areas
2022 FY 2023-24 (As of August 2023):

In-Lieu Parking Application: $17,222
Seal Beach $3,500 1996 This fee was established in 1996.

Venice Beach (LA) $18,000 2004 Fee was established in 2004. CA Coastal Commission appealed: 1) Fee
is less than the cost of providing one
parking space; 2) City has no plans to
use the collected fees to mitigate
parking impacts.

West Hollywood $20,000
*2012–buy credits for
deficient spaces
$480/space/year
2012 Parking in-lieu fee program was
replaced with a parking credits
program in 2012.

NEW: Application fee $650 +
$484.79/space/year + CPI
Santa Monica $20,000 + CPI Not
recent
Per AB 2097, no minimum parking
requirements in downtown
El Segundo Downtown–$19,486
Smoky Hollow–$31,179
2004\
2018
2004–Downtown $35,000 justified;
Council cut 1/2 to $17,500; adjusted
2018–Smoky Hollow Specific Plan–
$27,000;
Laguna Beach 25.52.006(e)–In-Lieu
Parking Certificate
Program–$23,000/space
2023 City performing update, with 2023
study indicating: City needs to
encourage more participation in-lieu
program; expand geographic area; inlieu fee be based loosely on the cost of providing parking, minus anticipated
net revenue from users.

City of Hermosa Beach | Page 5 of 6
Recommended Options
The City’s parking in-lieu fees have not been updated since 2006, are not adjusted annually, and are not adequate to fund additional parking resources. Staff recommends City Council conduct a discussion and provide staff with direction on:

1. Increasing the parking in-lieu fee (options below)
a. $113,000 per space, which accurately reflects the actual cost of funding construction of additional parking; or
b. Increasing the parking in-lieu fee to another desired amount

2. Consider including an annual inflation adjustment to the parking in-lieu fee a. Staff would return with a specific index (Consumer Price Index, California Construction Cost Index, Engineering and News Record Index– Construction, etc.) for consideration.

3. Provide direction and feedback to staff to update the criteria for evaluating parking in-lieu fee requests, as part of the ongoing Zoning Ordinance Update effort.

General Plan Consistency:

Link to General Plan: https://www.hermosabeach.gov/home/showdocument?id=9872 PLAN Hermosa, the City’s General Plan, was adopted by the City Council in August 2017.

The potential updating of parking in-lieu fees and criteria supports several PLAN Hermosa goals and policies that are listed below.

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

Policy:
 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.

Mobility Element
Goal 4. A parking system that meets the parking needs and demand of residents, visitors, and employees in an efficient and cost-effective manner.

Policies:
 4.1 Shared parking. Facilitate park-once and shared parking policies among private developments that contribute to a shared parking supply and interconnect with adjacent parking facilities.
 4.2 Encourage coastal access. Ensure parking facilities and costs of such facilities are not a barrier to beach access by the public.

City of Hermosa Beach | Page 6 of 6
Fiscal Impact:

There is no fiscal impact related to the recommended action. If the City Council provides direction to increase the parking in-lieu fee, staff would return with an analysis of any fiscal impacts.

Attachments:

1. Letter to Coastal Commission—December 2021

2. Inventory of In-Lieu Parking Spaces—August 2024

3. Integra Appraisal—December 2022

4. Kosmont Technical Memo—August 2024

5. Resolution 85-4875—Parking In-Lieu Fee Established

6. Resolution 99-6001—Parking In-Lieu Fee Increase

7. Resolution 06-6487—Parking In-Lieu Fee Increase
Respectfully Submitted by: Carrie Tai, AICP, Community Development Director Noted for Fiscal Impact: Viki Copeland, Administrative Services Director Legal Review: Patrick Donegan, City Attorney
Reviewed by: Angela Crespi, Deputy City Manager
Approved: Suja Lowenthal, City Manager

City of Hermosa Beach
Civic Center, 1315 Valley Drive, Hermosa Beach, CA 90254-3885 December 2, 2021
Steve Hudson, South Coast District Deputy Director

CALIFORNIA COASTAL COMMISSION
South Coast District Office
301 E. Ocean Blvd, Suite 300
Long Beach, CA 90802
RE: City of Hermosa Beach Parking In-Lieu Fee Program and 66 11th Street Dear Steve:

The City is committed to continuing to implement and update the approved parking and access policies and programs, in the certified Coastal LUP as amended in 2003. One particular program allows an in-lieu fund transfer of private funds, with approval of a Parking Plan and Planning Commission approval and inlieu fee to a designated improvement fund earmarked for creating parking, in an amount sufficient to offset the increase in required parking spaces associated with a development project. This program has proven to be useful in Hermosa Beach, has never been over-subscribed, and helped fund the construction of a parking structure circa 1998.

Part of the program includes setting the parking in-lieu fee rate. It is currently set at $28,900 for each required parking space not provided on-site with a new development, based on a 2006 City Council resolution, which set the fee at that rate based on appraisals done at the time.

The City understands that the rate needs re-evaluation, as well as other details of the program. We have discussed this issue recently with Coastal Commission staff in connection with the project at 66 11th Street and are committed to studying these issues in 2022.

The City will embark on this re-evaluation either as a focused matter, or preferably in conjunction with our current efforts to adopt and certify a Local Coastal Program consistent with the Coastal Act. As the Commission is aware, we have been working with the Coastal Commission, assisted by the Commission’s grant program, to achieve LCP certification. This will include the re-evaluation of existing parking programs, like the Parking In-Lieu fee program, which the City has found to be a valuable tool to provide flexible districtwide “park-once” based parking solutions for visitor-serving and other essential commercial projects in the City’s downtown pedestrian-oriented district adjacent to the beach, Strand bike and pedestrian path, and City pier. The City is also committed to implement the strategies and evaluation in the recent Coastal Zone Parking and Management Strategy, which includes several recommendations toward improving more efficient use of the City’s public parking supply, increasing supply, and providing other ways to access the beach long into the future.

We look forward to our continuing partnership with the Coastal Commission to address the unique parking and access needs in the City, whether in the downtown commercial district or other areas of the Coastal Zone.

Sincerely,
Suja Lowenthal
City Manager

Updated August 29, 2024
Parking In-Lieu Fee Program (100 Spaces)
Number of Parking Spaces Accepted
Projects Approved and Paid
Project / Location Parking
Spaces
In-Lieu
Year Status
Hennessey’s Tavern / 8 Pier Ave 2 1997 Funds transferred*/** 117 Pier Ave: The Mix / Currently Steak
and Whisky
5 1997 Funds transferred*/**
13 Businesses, Lower Pier Ave: Pier Plaza
Outdoor Dining
13 1997 Funds transferred*/**
1301 Hermosa Ave: City Retail Building
at North Pier Parking Structure
20 1997 Funds transferred*/**
51 Pier Ave: Fat Face Fenner’s
Fishshack / Currently Tower 12
5 1999 Funds collected**
205 Pier Ave: Commercial
Condominiums (Mixed Office and
Snack Shop)
1 2012 Fund collected 10/8/12
507 Pier Ave: The Solution 1 2015 Fund collected 6/25/15 513-519 Pier Ave: Dry cleaner & offices
(CC Reso 16-7046)
1 2016 Funds collected 11/22/17
1429 Hermosa Ave: H2O Hotel 2*** 2015 Funds collected 7/9/20 70 10th St 2 2019 Funds collected 4/20/2022
66 11th Street 7 2021 Funds collected 3/3/2022
Total Approved and Paid 59
Total Approved and Pending Payment 16
Net Available (100-75) = 25
*Funds transferred from Downtown Enhancement set-aside incentive fund established by City Council to Parking Improvement Fund.
**These funds were spent on the parking structure.
*** Fees for two (2) spaces as required by Coastal Commission.

Projects Approved and Pending Payment
Project / Location Parking
Spaces
In-Lieu
Year Status
906-910 Hermosa Ave: Hermosa Seaside
Commercial Office Building
16**** 2007 Permits issued and entitlements
extended (fees not collected at
this time). Fees must be paid
prior to final occupancy.

Total Approved and Pending Payment 16
****The Planning Commission approval was based on a 7 parking space deficiency based on a 3/1000 ratio, however, the Coastal Commission required 16 in-lieu parking spaces based on the currently applicable 4/1000 ratio.

Integra Realty Resources
Los Angeles
Appraisal of Real Property
In-Lieu Parking Fee Analysis
Downtown District Commercial Properties
Hermosa Beach Downtown District
Hermosa Beach, Los Angeles County, California 90254
Prepared For:

City of Hermosa Beach
Date of the Report:

December 23, 2022
Report Format:

Appraisal Report
IRR - Los Angeles
File Number: 121-2022-0220

Aerial Photograph
The city of Hermosa Beach is outlined in red in the aerial image shown above.

Integra Realty Resources 16030 Ventura Boulevard T 818.290.5400 Los Angeles Suite 620 www.irr.com
Encino, CA 91436-4473
December 23, 2022
Viki Copeland
Finance Director
City of Hermosa Beach
1315 Valley Drive
Hermosa Beach, CA 90254
SUBJECT: Market Rental Rate Appraisal
In-Lieu Parking Fee Analysis
Downtown District
Hermosa Beach, Los Angeles County, California 90254
IRR - Los Angeles File No. 121-2022-0220
Dear Ms. Copeland:

Integra Realty Resources – Los Angeles is pleased to submit the accompanying appraisal for the purpose of determining the market rate for in-lieu parking fees in the city of Hermosa Beach. The client for the assignment is City of Hermosa Beach and the intended use is to assist in establishing a current In-Lieu Parking Fee for use in Section 17.44 of the zoning code, related to the alternative satisfaction of off-street parking requirements for new development.

The City of Hermosa Beach has off-street parking requirements as part of the development standards for the commercial uses in the Downtown District. In some cases, an alternative to development is the payment of in-lieu parking fees, established by the City on a per space basis1. This appraisal report provides a conclusion of market-derived in-lieu fees for spaces, based on the following scope of work.
1 Title 17 Zoning, Chapter 17.44.040 Off-Street Parking, City of Hermosa Beach Municipal Code

Viki Copeland
City of Hermosa Beach
December 23, 2022

To determine an In-Lieu parking fee for this analysis, we have undertaken the following steps:

1. Review the existing ordinance.

2. Conduct research on what comparable municipalities and cities in Southern California charge for In-Lieu parking fees.

3. Perform a cost approach analysis relative to the cost of building a parking structure.

This includes an analysis of land and improvement costs to build a parking garage on a per space basis. This results in a concluded cost per parking space.

In this analysis, we reconcile the analysis from the aforementioned steps 2 and 3 and conclude to an In-Lieu parking fee for the Downtown District of Hermosa Beach.

The appraisal is intended to conform with the Uniform Standards of Professional Appraisal Practice (USPAP), and the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. To report the assignment results, we use the Appraisal Report option of Standards Rule 2-2(a) of USPAP.

Based on the valuation analysis in the accompanying report, and subject to the definitions, assumptions, and limiting conditions expressed in the report, our opinion of market rental rates is as follows:

Value Conclusion
Value Type & Appraisal Premise Interest Appraised Date of Value Value Conclusion
(Per Parking Space)
In-Lieu Parking Fees Fee Per Parking Space to
Satisfy Off-Street Parking
Zoning Requirements
November 15, 2022 $35,000
It is recommended that CPI increases are implemented to ensure that the rate continues to appropriately increase over time.

Extraordinary Assumptions and Hypothetical Conditions

1. None

1. None
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.

The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.

The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.

Viki Copeland
City of Hermosa Beach
December 23, 2022

If you have any questions or comments, please contact the undersigned. Thank you for the opportunity to be of service.

Respectfully submitted,
Integra Realty Resources - Los Angeles
Beth Finestone, MAI, AI-GRS, FRICS, CRE
California Certified General Real Estate
Appraiser #AG004030
Telephone: 818.290.5455
Email: [email protected]
Adam M. Bogorad, MAI
California Certified General Real Estate
Appraiser #AG038741
Telephone: 818.290.5418
Email: [email protected]

Table of Contents
In-Lieu Parking Fee Analysis
Summary of Salient Facts and Conclusions 1
General Information 2
Subject Description 2
Current Ownership and Sales History 2
Purpose of the Appraisal and Effective Date of Value 2
Definition of Market Value 2
Definition of Property Rights Appraised 3
Definition of In-Lieu Parking 3
Client, Intended Use and User 3
Applicable Requirements 4
Report Format 4
Prior Services 4
Scope of Work 4
Economic Analysis 6
Los Angeles County Area Analysis 6
Surrounding Area Analysis 11
Retail Market Analysis 16
Vacancy and Rental Rate Trends 18
Property Analysis 20
Commercial Land Analysis 20
Land Description and Analysis 20
Improvements Description and Analysis 21
Real Estate Taxes 22
Highest and Best Use 23
Valuation 24
Valuation Methodology 24
Analysis of Existing Ordinance 25
Survey of In-Lieu Parking Fees for Local Municipalities 26 Cost Approach – Land Valuation 28
Factors of Comparison 33
Land Value Conclusion – Hermosa Beach 38
Cost Approach - Improvement Valuation 39
Cost Approach – Overall Valuation 41
Overall Value Conclusion 42
Certification 43
Assumptions and Limiting Conditions 45
Addenda
A. Appraiser Qualifications
B. Comparable Data

Summary of Salient Facts and Conclusions 1
In-Lieu Parking Fee Analysis
Summary of Salient Facts and Conclusions
Property Name
Address
Property Type
Owner of Record
Tax ID
Zoning Designation
Highest and Best Use - Land Values in this Analysis
Effective Date of the Appraisal November 15, 2022
Date of the Report December 23, 2022
Property Interest Appraised
City of Hermosa Beach
N/A
In-Lieu Parking Fee Analysis
Downtown District
Hermosa Beach, Los Angeles County, California 90254
Retail - Other
The values reported herein are subject to the definitions, assumptions, and limiting conditions set forth in the accompanying report of which this summary is a part. No party other than City of Hermosa Beach may use or rely on the information, opinions, and conclusions contained in the report. It is assumed that the users of the report have read the entire report, including all of the definitions, assumptions, and limiting conditions contained therein.

C-2, Downtown Commercial and Specific Plan Area (Commercial Uses)
Commercial Use
Fee simple and In-Lieu Parking Fees
Value Conclusion
Value Type & Appraisal Premise Interest Appraised Date of Value Value Conclusion
(Per Parking Space)
In-Lieu Parking Fees Fee Per Parking Space to
Satisfy Off-Street Parking
Zoning Requirements
November 15, 2022 $35,000
It is recommended that CPI increases are implemented to ensure that the rate continues to appropriately increase over time.

Extraordinary Assumptions and Hypothetical Conditions

1. None

1. None
The use of any extraordinary assumption or hypothetical condition may have affected the assignment results.

The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.

The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.

Subject Description 2
In-Lieu Parking Fee Analysis
General Information
Subject Description
The City of Hermosa Beach has off-street parking requirements as part of the development standards for the commercial uses in the Downtown District. In some cases, an alternative to development is the payment of in-lieu parking fees, established by the City on a per space basis2. This appraisal report provides a conclusion of market-derived in-lieu fees for spaces, based on the following scope of work.

To determine an In-Lieu parking fee for this analysis, we have undertaken the following steps:

1. Review the existing ordinance.

2. Conduct research on what comparable cities in Southern California charge for In-Lieu parking fees.

3. Perform a cost approach analysis relative to the cost of building a parking structure. This includes an analysis of land and improvement costs to build a parking garage on a per space basis. This results in a concluded cost per parking space.

In this analysis, we reconcile the analysis from the aforementioned steps 2 and 3 and conclude to an In-Lieu parking fee for the Downtown District of Hermosa Beach.

Current Ownership and Sales History
The subject of this analysis is commercial development sites in the Downtown District of Hermosa Beach, typically owned by private entities. In Lieu parking fees are paid to circumvent the need to otherwise provide off-street parking in the event of commercial development. Because this is an analysis of a hypothetical parcel, no ownership or sale history is pertinent.

Purpose of the Appraisal and Effective Date of Value
The purpose of the appraisal is to develop an opinion of the market rate for Parking In-Lieu fees in the City of Hermosa Beach, as defined in the Municipal Code, Section 17.44.040 Parking requirements for the downtown district. The effective date of the appraisal is November 15, 2022 and the date of the report is December 23, 2022. The appraisal is valid only as of the stated effective date.

Definition of Market Value
Market value is defined as:
“The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and 2 Title 17 Zoning, Chapter 17.44 Off-Street Parking, City of Hermosa Beach Municipal Code

Definition of Property Rights Appraised 3
In-Lieu Parking Fee Analysis
assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
 Buyer and seller are typically motivated;
 Both parties are well informed or well advised, and acting in what they consider their own best interests;
 A reasonable time is allowed for exposure in the open market;  Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
 The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.” (Source: Code of Federal Regulations, Title 12, Chapter I, Part 34.42[g]; also Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472) Definition of Property Rights Appraised
Fee simple estate is defined as, “Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.”
Source: Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago: Appraisal Institute, 2015)
Definition of In-Lieu Parking
The following definition is from Section 17.44.040 of the Hermosa Beach Municipal Code, Parking requirements for the downtown district:
“When the city council provides for contributions to an improvement fund for a vehicle parking district in lieu of parking spaces so required, said in-lieu fee contributions shall be considered to satisfy the requirements of this chapter pursuant to a parking plan approved by the planning commission.” Where developments are proposed, sufficient funds can be collected to help support construction of public off-street parking. The funds collected are to supplement the community’s own resources, and these funds should complement an existing program of municipally constructed off-street parking.

Parking in-lieu fees are a voluntary option when parking requirements cannot or will not be met. The concept of parking in-lieu fees is based on the need for the City to provide additional parking and make up for the shortfalls created when property owners do not provide off-street parking per development standards.

Client, Intended Use and User
The intended use of the appraisal is to determine the market-derived parking in-lieu fee, as previously discussed. The client is the City of Hermosa Beach The intended user of the report is the City of

Applicable Requirements 4
In-Lieu Parking Fee Analysis
Hermosa Beach. No party or parties other than the City of Hermosa Beach may use or rely on the information, opinions, and conclusions contained in this report.

Applicable Requirements
This appraisal is intended to conform to the requirements of the following:
 Uniform Standards of Professional Appraisal Practice (USPAP);  Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.

Report Format
This report is prepared under the Appraisal Report option of Standards Rule 2-2(a) of USPAP.

Prior Services
USPAP requires appraisers to disclose to the client any other services they have provided in connection with the subject property in the prior three years, including valuation, consulting, property management, brokerage, or any other services.

We have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment. We have performed an analysis of encroachment rental rates for the same client, in a separate report.

Scope of Work
To determine the appropriate scope of work for the assignment, we considered the intended use of the appraisal, the needs of the user, the complexity of the property, and other pertinent factors. Our concluded scope of work is described below.

Valuation Methodology
The purpose of this appraisal is to determine the market value of in-lieu parking fees for the Downtown District of Hermosa Beach. The methodology used upon relies on elements of the sales comparison and cost approaches.

To determine an In-Lieu parking fee for this analysis, we have undertaken the following steps:

1. Review the existing ordinance.

2. Conduct research on what comparable cities in Southern California charge for In-Lieu parking fees.

3. Perform a cost approach analysis relative to the cost of building a parking structure. This includes an analysis of land and improvement costs to build a parking garage on a per space basis. This results in a concluded cost per parking space.

Scope of Work 5
In-Lieu Parking Fee Analysis
In this analysis, we reconcile the analysis from the aforementioned steps 2 and 3 and conclude to an In-Lieu parking fee for the Downtown District of Hermosa Beach.

The following table indicates the approaches to value used in this analysis.

Approaches to Value
Approach Applicability to Subject Use in Assignment
Cost Approach Applicable Utilized
Sales Comparison Approach Applicable Utilized
Income Capitalization Approach Not Applicable Not Utilized While the cost approach and sales comparison approaches are not fully developed in the way they might be for an appraisal of a specific property, elements of these approaches are used in our analysis and they serve as a basis for our value conclusion. A greater explanation of the methodology is contained in the valuation section of this report.

Research and Analysis
The type and extent of our research and analysis is detailed in individual sections of the report. This includes the steps we took to verify comparable sales, which are disclosed in the comparable sale profile sheets in the addenda to the report. Although we make an effort to confirm the arms-length nature of each sale with a party to the transaction, it is sometimes necessary to rely on secondary verification from sources deemed reliable.

Inspection
Adam M. Bogorad, MAI, inspected the Downtown District of the Hermosa Beach on November 11, 2022.

Beth Finestone, MAI, AI-GRS, FRICS, CRE, previously performed inspections of the area on June 11, 2017.

Significant Appraisal Assistance
It is acknowledged that Brian DeGuzman made a significant professional contribution to this appraisal, consisting of conducting research on the subject market segments and transactions involving comparable properties, under the supervision of the persons signing the report.

Los Angeles County Area Analysis 6
In-Lieu Parking Fee Analysis
Economic Analysis
Los Angeles County Area Analysis
Los Angeles County is 4,058 square miles in size and has a population density of 2,469 persons per square mile.

Population
Los Angeles County has an estimated 2022 population of 10,018,350, which represents an average annual 0.2% increase over the 2010 census of 9,818,605. Los Angeles County added an average of 16,645 residents per year over the 2010-2022 period, but its annual growth rate lagged the State of California rate of 0.5%.

Looking forward, Los Angeles County's population is projected to increase at a 0.2% annual rate from 2022-2027, equivalent to the addition of an average of 15,544 residents per year. Los Angeles County's growth rate is expected to lag that of California, which is projected to be 0.4%.

Population Compound Ann. % Chng
2010 Census 2022 Estimate 2027 Projection 2010 - 2022 2022 - 2027 USA 308,745,538 334,279,739 344,999,336 0.7% 0.6%
California 37,253,956 39,725,146 40,499,252 0.5% 0.4%
Los Angeles County 9,818,605 10,018,350 10,096,071 0.2% 0.2% Los Angeles-Long Beach et al 12,828,837 13,207,559 13,343,788 0.2% 0.2% Source: Claritas
Population Trends
Employment
Total employment in Los Angeles County was estimated at 4,218,812 jobs as of June 2021. Between year-end 2011 and 2021, employment rose by 263,293 jobs, equivalent to a 6.7% increase over the entire period. There were gains in employment in nine out of the past ten years. Consistent with national trends, there were significant losses in 2020, with the onset of the COVID-19 pandemic, followed by a return to positive growth in 2021. Although Los Angeles County's employment rose over the last decade, it underperformed California, which experienced an increase in employment of 15.3% or 2,256,471 jobs over this period.

A comparison of unemployment rates is another way of gauging an area’s economic health. Over the past decade, the Los Angeles County unemployment rate has been generally higher than that of California, with an average unemployment rate of 8.2% in comparison to a 7.4% rate for California. A higher unemployment rate is a negative indicator.

Recent data shows that the Los Angeles County unemployment rate is 4.9% in comparison to a 4.1% rate for California, a negative sign that is consistent with the fact that Los Angeles County has underperformed California in the rate of job growth over the past two years.

Los Angeles County Area Analysis 7
In-Lieu Parking Fee Analysis
Employment Trends
Total Employment (Year End) Unemployment Rate (Ann. Avg.) Year
Los Angeles
County
%
Change California
%
Change
Los Angeles
County California
2011 3,955,519 14,735,619 12.2% 11.9%
2012 4,085,523 3.3% 15,223,789 3.3% 11.0% 10.5%
2013 4,177,944 2.3% 15,657,015 2.8% 9.8% 9.0%
2014 4,244,204 1.6% 16,089,814 2.8% 8.2% 7.6%
2015 4,355,391 2.6% 16,606,038 3.2% 6.7% 6.3%
2016 4,416,052 1.4% 16,930,563 2.0% 5.3% 5.5%
2017 4,468,712 1.2% 17,263,084 2.0% 4.8% 4.8%
2018 4,526,194 1.3% 17,573,378 1.8% 4.7% 4.3%
2019 4,594,584 1.5% 17,857,719 1.6% 4.6% 4.2%
2020 4,115,123 -10.4% 16,401,290 -8.2% 12.9% 10.2%
2021* 4,218,812 2.5% 16,992,090 3.6% 9.6% 7.3%
Overall Change 2011-2021 263,293 6.7% 2,256,471 15.3%
Avg Unemp. Rate 2011-2021 8.2% 7.4%
Unemployment Rate - August 2022 4.9% 4.1%
Source: U.S. Bureau of Labor Statistics and Moody's Analytics. Employment figures are from the Quarterly Census of Employment and Wages (QCEW). Unemployment rates are from the Current Population Survey (CPS). The figures are not seasonally adjusted. *Total employment data is as of June 2021; unemployment rate data reflects the average of 12 months of 2021.

Major employers in Los Angeles County are shown in the following table.

Name Number of Employees
1 County of Los Angeles 95,200
2 Los Angeles Unified School District 75,700
3 City of Los Angeles (including DWP) 72,600
4 University of California, Los Angeles 51,000
5 Kaiser Permanente 41,300
6 Federal Government (Except Postal Service) 30,600
7 State of California (non-education) 28,000
8 University of Southern California 22,200
9 Northrup Grumman Corp. 18,000
10 Federal Government (Postal Service) 16,800
Major Employers - Los Angeles County
Source: Southern California Association of Governments, Comprehensive Annual Financial Report, June 2021 Gross Domestic Product
Gross Domestic Product (GDP) is a measure of economic activity based on the total value of goods and services produced in a defined geographic area, and annual changes in Gross Domestic Product (GDP) are a gauge of economic growth.

Los Angeles County Area Analysis 8
In-Lieu Parking Fee Analysis
Economic growth, as measured by annual changes in GDP, has been considerably lower in Los Angeles County than California overall during the past ten years. Los Angeles County has grown at a 1.6% average annual rate while California has grown at a 2.9% rate. Los Angeles County appears to be harder hit in the recent downturn, as the area's GDP declined by 6.3% in 2020 while California's GDP declined by 2.8%. GDP figures for 2021 are not yet available at the local level, but GDP on a national level increased 5.7% in 2021, in contrast to the pandemic-related decrease of 3.4% in 2020.

Los Angeles County has a per capita GDP of $66,311, which is 2% less than California's GDP of $67,435.

This means that Los Angeles County industries and employers are adding relatively less value to the economy than their counterparts in California.

Gross Domestic Product
Year
($,000s)
Los Angeles
County % Change
($,000s)
California % Change
2011 571,324,012 2,063,827,500
2012 576,713,190 0.9% 2,113,096,400 2.4%
2013 587,370,781 1.8% 2,179,229,000 3.1%
2014 604,034,122 2.8% 2,256,054,700 3.5%
2015 628,765,253 4.1% 2,357,452,900 4.5%
2016 639,934,876 1.8% 2,427,894,600 3.0%
2017 662,418,536 3.5% 2,541,769,300 4.7%
2018 681,549,961 2.9% 2,643,576,300 4.0%
2019 703,781,312 3.3% 2,739,343,400 3.6%
2020 659,328,437 -6.3% 2,663,665,900 -2.8%
Compound % Chg (2011-2020) 1.6% 2.9%
GDP Per Capita 2020 $66,311 $67,435
Source: U.S. Bureau of Economic Analysis and Moody's Analytics; data released December 2021. The release of state and local GDP data has a longer lag time than national data. The data represents inflation-adjusted ""real"" GDP stated in 2012 dollars.

Income, Education and Age
Los Angeles County has a lower level of household income than California. Median household income for Los Angeles County is $81,133, which is 8.8% less than the corresponding figure for California.

Median
Los Angeles County $81,133
California $88,967
Comparison of Los Angeles County to California - 8.8%
Source: Claritas
Median Household Income - 2022

Los Angeles County Area Analysis 9
In-Lieu Parking Fee Analysis
Residents of Los Angeles County have a slightly lower level of educational attainment than those of California. An estimated 33% of Los Angeles County residents are college graduates with four-year degrees, versus 35% of California residents. People in Los Angeles County are similar in age to their California counterparts. The median age of both Los Angeles County and California is 38 years.

Education & Age - 2022
Source: Claritas
10%
20%
30%
40%
50%
60%
70%
80%
Los Angeles County California
33% 35%
Percent College Graduate
10 15
20 25
30 35
40 45
50 Los Angeles County California
38 38
Median Age
Conclusion
The Los Angeles County economy will be affected by a stable to slightly growing population base and lower income and education levels. Los Angeles County experienced growth in the number of jobs over the past decade, and it is reasonable to assume that employment growth will occur in the future.

It is anticipated that the Los Angeles County economy will improve and employment will grow, strengthening the demand for real estate in coming years.

We do note, however, that concerns about inflation and rising interest rates have tempered growth expectations for the early part of 2023, and there are concerns about the national economy entering a recession in the next 12 months.

Los Angeles County Area Analysis 10
In-Lieu Parking Fee Analysis
Area Map

Surrounding Area Analysis 11
In-Lieu Parking Fee Analysis
Surrounding Area Analysis
Location
The subject area is located in the City of Hermosa Beach, which is located in the southwest of Los Angeles County. Specifically, the subject is located within the Downtown District of Hermosa Beach, generally proximate to the intersection of Hermosa Avenue and Pier Avenue.

The surrounding area is primarily urban in nature with supporting commercial uses on the major thoroughfares and residential on the secondary streets. For purposes of this report, the immediate market area boundaries are best described as follows:

North 27th Street / Gould Avenue
South Herondo Street
East Pacific Coast Highway
West Pacific Ocean
Downtown District
The following description of the Downtown District is directly from the General Plan of the City of Hermosa Beach.
“The Downtown District is a primary social and commercial activity center in Hermosa Beach, serving as a centralized location for social gatherings and the recreational activities of residents and visitors. Pier Plaza serves as a popular venue for outdoor events and dining, connecting Downtown to the beach, pier, and The Strand. The “pedestrian scramble” at the intersection of Hermosa Avenue and Pier Avenue is a unique pedestrian amenity that reinforces the pedestrian-oriented nature of Downtown.” The district aims to preserve the pedestrian realm along Pier Avenue, enhance the building form and orientation, and transform the realm on Hermosa Avenue. Downtown will continue to offer a variety of uses that improve the livelihoods of local residents. “The types of uses provide services and activities associated with the local beach culture to residents as well as visitors to the city. The mix of community and recreational uses serve a functional role in meeting the daily needs and activities of residents and visitors, and accommodate coastal-related recreation and commercial uses which serve the year-round needs of residents and visitors and are attractive and compatible with adjacent residential neighborhoods and commercial districts.”

Surrounding Area Analysis 12
In-Lieu Parking Fee Analysis
The following map identifies the Downtown District of Hermosa Beach, within which the subject of this analysis is located.

Pier Avenue is the major east-west arterial in this area and Hermosa Avenue (one block from the beach) is the major north-south arterial. The Pier Avenue right of way becomes Pier Plaza to the west of Hermosa Avenue. There is no vehicular access to that area, and it serves as the central retail location in the district.

Access and Linkages
Primary highway access to the area is via Pacific Coast Highway, a major arterial that runs in a north/south direction. A majority of the subject area is accessible from Pier Avenue, a major arterial that runs in an east/west direction. The remaining subject locations are accessible from Hermosa Avenue, a major arterial that runs in a north/south direction.

Surrounding Area Analysis 13
In-Lieu Parking Fee Analysis
Public transportation is provided by Beach Cities Transit and Metropolitan Transportation Authority.

The nearest bus stop is located on the northwest corner of the Hermosa Avenue and Pier Avenue intersection. The local market perceives public transportation as good compared to other areas in the region. The primary mode of transportation in this area is automobile.

Los Angeles International Airport is located approximately five miles north of the typical subject location. Long Beach Airport is approximately 15 miles southeast of the subject.

Demand Generators
Demand is generated primarily from approximately 1 ½ miles of public beach property with direct access to retail. This includes the Strand, which is a communal boardwalk with various retail properties that starts from Torrance Beach, runs through Hermosa Beach, and extends through Santa Monica beach. In addition, there is also the Hermosa Pier, which offers a series of commercial retail properties.

Demographics
A demographic profile of the surrounding area of the Downtown District in Hermosa Beach, including population, households, and income data, is presented in the following table.

Surrounding Area Demographics
2022 Estimates 1-Mile Radius 3-Mile Radius 5-Mile Radius Los Angeles
County California
Population 2010 23,194 153,081 371,508 9,818,605 37,253,956 Population 2022 23,209 153,091 374,189 10,018,350 39,725,146 Population 2027 23,261 153,418 375,570 10,096,071 40,499,252 Compound % Change 2010-2022 0.0% 0.0% 0.1% 0.2% 0.5%
Compound % Change 2022-2027 0.0% 0.0% 0.1% 0.2% 0.4%
Households 2010 11,029 63,272 143,179 3,241,204 12,577,498 Households 2022 10,937 63,067 143,513 3,309,578 13,379,828 Households 2027 10,936 63,171 143,908 3,336,723 13,634,200 Compound % Change 2010-2022 -0.1% 0.0% 0.0% 0.2% 0.5%
Compound % Change 2022-2027 0.0% 0.0% 0.1% 0.2% 0.4%
Median Household Income 2022 $151,983 $134,462 $109,769 $81,133 $88,967 Average Household Size 2.1 2.4 2.6 3.0 2.9
College Graduate % 74% 63% 51% 33% 35%
Median Age 42 43 41 38 38
Owner Occupied % 49% 54% 50% 47% 56%
Renter Occupied % 51% 46% 50% 53% 44%
Median Owner Occupied Housing Value $1,887,999 $1,296,744 $1,026,803 $748,344 $658,725 Median Year Structure Built 1971 1969 1964 1964 1976
Average Travel Time to Work in Minutes 38 35 34 36 33
Source: Claritas
As shown above, the current population within a 3-mile radius of the subject is 153,091, and the average household size is 2.4. Population in the area has been flat since the 2010 census, and this trend is projected to continue over the next five years. This differs slightly from the population of Los Angeles County, which is projected to have modest growth over the same period.

Surrounding Area Analysis 14
In-Lieu Parking Fee Analysis
Median household income is $134,462, which is higher than the household income for Los Angeles County. Residents within a 3-mile radius have a considerably higher level of educational attainment than those of Los Angeles County, and median owner-occupied home values are considerably higher.

Land Use
The area is suburban in character and approximately 95% developed.

Land uses immediately surrounding the subject are comprised primarily of commercial retail uses along the arterial roads and single-family residential uses along the local roads. Typical ages of building improvements range from 10 to 65 years.

Nearby Retail Uses
The following nearby retail properties have significant drawing power that affects the subject and other retail properties in the area:

1. Hermosa Beach – Approximately 1 ½ miles of public beach property with direct access to retail properties.

2. The Strand – A communal boardwalk with various retail properties that starts at Torrance Beach, running through Hermosa Beach, and extends through Santa Monica beach.

3. Hermosa Beach Pier – A series of commercial, retail properties, which extends onto Pier Plaza, the heart of the Downtown District.

Outlook and Conclusions
The area is in the stability stage of its life cycle. Recent development activity is contained to scattered infill locations and has been centered on primarily residential properties. We anticipate that property values will continue to increase in the near future, as demand outpaces supply for a limited amount of beachfront properties. However, if a national recession occurs, it is likely that values will stabilize and possibly decline.

Surrounding Area Analysis 15
In-Lieu Parking Fee Analysis
Surrounding Area Map

Retail Market Analysis 16
In-Lieu Parking Fee Analysis
Retail Market Analysis
The subject area in this analysis is the Downtown District of Hermosa Beach. Properties are typically developed with commercial uses in this area, with retail being the predominant land use. As such, we have included a retail market analysis in this report. In the following paragraphs, we examine supply and demand indicators for retail space in the subject areas, based on data from CoStar, a widely recognized source of market data.

Beach Cities Overview
The subject is located in Hermosa Beach, which is part of the Beach Cities submarket in Los Angeles County, according to The CoStar Retail Submarket Report. The submarket includes the Hermosa Beach, Manhattan Beach, Redondo Beach, and Rancho Palos Verdes.

The following tables indicate the overall statistics for the Beach Cities submarket dating back to 2010 and including projections through 2026.

Even through the pandemic that began in 2020, rental growth has increased every year for the past decade. In 2020, the constrictions on retail use led to a generally flat rent for a year, but there has been growth in rental rates for the two years since the end of 2020 and this trend is projected to continue forward.

We do note that vacancy increased in 2020 and is not projected to reach pre-pandemic levels again for the foreseeable future. However, the Downtown District of Hermosa Beach, particularly the areas on Hermosa Avenue and to the west, are among the highest demand areas in this submarket. This is the area being analyzed in this report.

Retail Market Analysis 17
In-Lieu Parking Fee Analysis
The Beach Cities submarket has a similar vacancy rate than that of the overall Los Angeles market and has exhibited a slightly steeper decline in vacancy between 2018 and 2020.

In terms of quoted rents, the submarket has increased at a rate of 2.2% over the past year and 2.4% throughout 2021. The submarket has seen consistent rental increases between 2013 and 2017 and declined to under 3% by 2018.

Retail Market Analysis 18
In-Lieu Parking Fee Analysis
Vacancy and Rental Rate Trends
The following tables illustrate vacancy and rental rate trends in the submarket area, which also indicates that the Beach Cities submarket maintains a similar vacancy rate with the overall Los Angeles market.

It is notable that the vacancy in the Beach Cities submarket is generally stabilized and (with the exception of mall vacancy) has fluctuated between 3.8% and 5.4% through recent years. The current rate is lower than that of pre-pandemic levels, even with the slight increase in rent. It is also noted that the mall product has underperformed compared to the various other products offered in the submarket. Within the Beach Cities submarket, there are currently no notable retail projects under construction.

Forecasts indicate that market fundamentals are expected to continue to improve incrementally.

Vacancies are trending downward with increasing leasing activity. Rental growth is projected for the next five years while demand exceeds deliveries. Sales are also forecast to achieve moderate gains due to modest NOI growth and generally flat cap rates. In the immediate future, however, market participants forecast that interest rate hikes will put upward pressure on capitalization rates and value increases may slow or even reverse. There may also be slowdown in transactional activity compared to the past year.

Retail Market Outlook and Conclusions
The overall Hermosa Beach market has shown signs of slow, but consistent growth since the economic recession of 2008. In the near term, rents are expected to continue to slowly increase and vacancy will continue to remain stable until new construction increases. The lack of new product in the market

Retail Market Analysis 19
In-Lieu Parking Fee Analysis
has been asserting upward pressure on rental rates and the demand for new development. These trends are expected to continue in the foreseeable future.

Forecasts indicate that market fundamentals are expected to continue to improve incrementally.

Rental growth is projected for the next five years while demand exceeds deliveries. Sales are also forecast to achieve moderate gains due to modest NOI growth and generally flat capitalization rates.

In the immediate future, however, market participants forecast that interest rate hikes will put upward pressure on capitalization rates and value increases may slow or even reverse. There may also be slowdown in transactional activity compared to the past year.

Commercial Land Analysis 20
In-Lieu Parking Fee Analysis
Property Analysis
Commercial Land Analysis
In this report, one element of the analysis is a cost approach related to the potential development of a parking garage in the subject area. The land in this area is mostly commercially zoned and located near the intersection of Hermosa Avenue and Pier Avenue in Hermosa Beach. The following table shows other characteristics of the hypothetical land being valued later in this analysis.

Land Description and Analysis
Land Area 0.69 acres; 30,000 SF
Topography Generally level and at street grade
Drainage No problems reported or observed
Environmental Hazards None reported or observed
Ground Stability No problems reported or observed
Flood Area Panel Number 06037C1907F
Date April 21, 2021
Zone X
Description Outside of 500-year floodplain
Insurance Required? No
Zoning; Other Regulations
Zoning Jurisdiction City of Hermosa Beach
Zoning Designation C-2
Description Downtown Commercial and
Legally Conforming? Appears to be legally conforming
Zoning Change Likely? No
Permitted Uses Broad commercial utility including
office, retail, service, hospitality
and supporting uses.

Utilities
Service Provider Adequacy
Water California Water Service
Sewer City of Hermosa Beach
Electricity Southern California Edison
Natural Gas Southern California Gas Company
Local Phone Various Providers
Source: City of Hermosa Municipal Code and Government Website Land Description - Typical Parcel

Improvements Description and Analysis 21
In-Lieu Parking Fee Analysis
Conclusion of Land Analysis
As previously indicated, this analysis is an appraisal of in-lieu parking and includes a cost approach with a land valuation to ascertain the per space of a replacement parking lot. For the purpose of this analysis, we consider 30,000 square feet to be the typical land size of a property that would be developed with a parking garage in the Downtown District.

Improvements Description and Analysis
We are valuing both the land and the cost to develop a five-story parking garage in the City of Hermosa Beach. The valuation is based on a hypothetical piece of land that is vacant. The improvements are discussed in the valuation section of this report.

Real Estate Taxes 22
In-Lieu Parking Fee Analysis
Real Estate Taxes
Real estate tax assessments are administered by the Assessor of Los Angeles County and are estimated by jurisdiction on a county basis for the subject. The property is subject to the property tax rules of the State of California, which control the activities and policies of local assessment jurisdictions. These laws were significantly modified on June 7, 1978, when the State’s voters passed Proposition 13, amending Article XIII of the State Constitution.

Proposition 13 abolished the practice of periodic reassessment of properties based on market value appraisals. Instead, real property is subject to reassessment (i.e., revaluation at full or partial current market value) only when changes in ownership or new construction take place. Otherwise, increases in assessed value are limited to a general rate of 2%, plus the rates needed to service any bonded indebtedness. Special assessments can also be added, and are often related to the installation of infrastructure. Generally speaking, property taxes in Los Angeles County tend to range from 1.1% to

1.4% of a property’s assessed value. Due to California’s tax laws, most properties within Los Angeles County have very similar effective tax rates.

The subject area is located within the City of Hermosa Beach. As no specific parcel is being valued, there is no specific tax rate to analyze. We do note that the tax rate for the area is 1.061412% of the assessed value.

Highest and Best Use 23
In-Lieu Parking Fee Analysis
Highest and Best Use
The purpose of this appraisal is to determine in-lieu parking fees for Downtown District of the City of Hermosa Beach. The ordinance allowing in-lieu fees relates to commercial properties including office and retail uses. As such, we have assumed a commercial highest and best use for the hypothetical parcel being valued.

Valuation Methodology 24
In-Lieu Parking Fee Analysis
Valuation
Valuation Methodology
The purpose of this appraisal is to determine the market value of in-lieu parking fees for the Downtown District of Hermosa Beach. The methodology used upon relies on elements of the sales comparison and cost approaches.

To determine an In-Lieu parking fee for this analysis, we have undertaken the following steps:

1. Analysis of the existing Hermosa Beach ordinance. In this section, we consider the language of the municipal code as it relates to In-Lieu parking fees. We also consider the current fee as of the date of value.

2. Survey of In-Lieu Parking Fees for local municipalities. Conduct research on what comparable cities in Southern California charge for In-Lieu parking fees and consider this information in our determination of a market rate for Hermosa Beach.

3. Cost approach analysis for alternative parking structure. In this section, we perform a cost approach analysis relative to the cost of building an alternative parking structure that the City of Hermosa Beach would hypothetically (or actually) use to provide the adequate parking in the event that the off-street parking requirements of existing development standards are not met. This includes an analysis of land and improvement costs to build a parking garage on a per space basis. This results in a concluded cost per parking space.

In this analysis, we reconcile the analysis from the aforementioned steps 2 and 3 and conclude to an In-Lieu parking fee for the Downtown District of Hermosa Beach.

Analysis of Existing Ordinance 25
In-Lieu Parking Fee Analysis
Analysis of Existing Ordinance
As an alternative to meeting the off-street parking requirements of development standards, the City of Hermosa Beach offers voluntary parking in-lieu fees in the Downtown District. This area is the economic commercial center of the city, near the beach, and is an attraction for both consumers and businesses. Typical lot sizes are small in this area, and many existing developments do not feature offstreet parking. There are multiple lots and options for public parking along Hermosa Avenue and on some of the other local streets in the area.

The following parking requirements apply within the boundary of the Downtown District, as defined in Section 17.44.040 of the Hermosa Beach municipal code:

1. The amount of parking shall be calculated for each particular use as set forth in Section

17.44.030 with the exception of the following:
a. Retail, general retail commercial uses: one (1) space for each 333.33 square feet of gross floor area (or three (3) spaces per one thousand (1,000) square feet). b. Offices, general: one (1) space for each 333.33 square feet of gross floor area (or three (3) spaces per one thousand (1,000) square feet).
c. Office, medical: one (1) space for each 333.33 square feet of gross floor area (or three (3) spaces per one thousand (1,000) square feet).

2. Parking In-Lieu Fees. When the city council provides for contributions to an improvement fund for a vehicle parking district in lieu of parking spaces so required, said in-lieu fee contributions shall be considered to satisfy the requirements of this chapter pursuant to a parking plan approved by the planning commission.

Parking in-lieu fees are a voluntary option when parking requirements cannot or will not be met. The concept of parking in-lieu fees is based on the need for the City to provide additional parking and make up for the shortfalls created when property owners do not provide off-street parking per development standards. It is noted that because of the generally small parcel sizes and the configuration of many commercial areas in Hermosa Beach, many property owners rely heavily on public parking and do not provide adequate minimum off street parking spaces.

In Hermosa Beach, the current parking in-lieu fee is $28,900 per space. The current rate has not been updated in many years and this is a common occurrence among various municipalities. This section of the municipal code was updated on October 14, 2022, but the fees have not been re-established in over a decade and they were established in July of 2006.

Prior to the most recent update, the fee was set at $12,500 per space in June of 1999.

With so many years having passed since the current fee was established, and property values having increased since that time, it is reasonable to expect that the current market fee is higher than the existing fee in place as of the date of value.

Survey of In-Lieu Parking Fees for Local Municipalities 26 In-Lieu Parking Fee Analysis
Survey of In-Lieu Parking Fees for Local Municipalities In-lieu parking fees are utilized as an alternative means of replacing the physical off-street parking that property owners are required to provide in a proposed development project. When providing the required off-street parking spaces is not feasible, a parking in-lieu fee can instead be paid to the municipality. These funds are used by the governing agency to then provide additional parking to compensate for the shortfall within a zoning district. This type of fee exists in other nearby cities and municipalities.

We interviewed various municipalities for the following survey of rates.  Huntington Beach has a current fee of $32,158 per space for properties that do not meet parking requirements. The fee is updated each year as of October 1 and is calculated based off the Caltrans Price Index for Selected Highway Construction Items according to a 3-year rolling average. The maximum upward adjustment is 3% each year. Huntington Beach initially set their in-lieu parking fee at $27,350 in 2010. If the 3% ceiling on growth were removed, the rate would be even higher based on CPI increases since 2010.  Beverly Hills scales their in-lieu parking fee based on location and recently updated the fee in 2022. The total fee is $54,774 for properties on Rodeo Drive, $43,819 for properties on Beverly Drive, and $32,959 for all other properties in their jurisdiction. Based on the land values on Rodeo Drive, and Beverly Drive, it is expected that these areas set the upper limit of market rate for the subject area.
 Seal Beach has a current fee of $3,500 per deficient space. This is far lower than many of the other surrounding communities.
 The Venice neighborhood of Los Angeles is a beach-oriented community and has a fee of $18,000 per space built into its specific plan. However, the local planner stated that the rate has not been changed since 2000 and the Coastal Commission has stated that the rate is too low for the area. If the rate was increased by CPI inflation from its inception to the current date of value, the resulting rate would be $31,778.
 The City of West Hollywood formerly had a fee of $20,000 per space. However, in 2012, the City changed their system into parking district overlays that allowed businesses to buy credits for deficient spaces, with a fee of $480 per space, per year for as long as they are in operation.

This change was made to lower parking costs for new businesses.  Santa Monica has a fee of $20,000 and is adjusted each year based on CPI increases. This fee was not recently established.
 El Segundo has two fees in different specific plan areas of the city. o Downtown Specific Plan: In 2004, El Segundo established that the businesses in the Downtown Specific Plan area should pay an in-lieu parking fee of $35,000, but the City Council decided to reduce the fee to $17,500 (or half) to incentivize businesses to

Survey of In-Lieu Parking Fees for Local Municipalities 27 In-Lieu Parking Fee Analysis
expand in the area. In 2020, they implemented annual CPI increases, bringing the current rate fee of $18,135 per space. A local planner for the City indicated that a market-based fee would likely be much higher as it has been a very long time since this rate has been reset. If the rate was increased by CPI inflation from when it was established in 2004, the rate would currently be $28,159. o Smoky Hollow Specific Plan: In 2018, El Segundo established a rate of $27,000.

However, in 2020, they implemented annual CPI increases, bringing the current rate to $29,017. If the rate was increased by CPI inflation from when it was established in 2018, the rate would currently be $32,462.
 Laguna Beach has an in-lieu parking fee of $23,000.
 Redondo Beach has no in-lieu parking fee.

The fees from the municipalities surveyed in this section range from $3,500 to $54,774 per space.

However, the highest fees in the range are located in Beverly Hills, which has the most valuable real estate in the county (and among the highest in the entire United States). A majority of the municipalities, especially beach communities, have fees that range from between $20,000 to $32,000.

It is also important to note that most areas have not updated their fees in several years in an effort to keep fees low and attract new businesses. Even after CPI adjusting some of the lower fees, a vast majority of the areas remain within the range of $30,000 to $40,000 per parking space. It is reasonable to anticipate an appropriate range would fall toward the upper end of the range of surveyed municipalities.

Cost Approach – Land Valuation 28
In-Lieu Parking Fee Analysis
Cost Approach – Land Valuation
The purpose of the cost approach is to conclude the cost of a public parking structure to be built by the City of Hermosa Beach as an alternative to the creation of off-street parking spaces by private sector property owners. The in-lieu fees paid by the property owners would fund this structure and therefore would help to satisfy their share of the need for parking in the area.

We start our cost approach analysis by determining an applicable underlying land value for a hypothetical Hermosa Beach property that can be used to create a parking structure. There is no specific property identified. Rather, we consider that a site would need to have a minimum of 30,000 square feet and be located in the Downtown District of Hermosa Beach. After the land is valued, we then conclude our study with a cost analysis to develop the structural component of the parking garage. The land is considered to be located in the Downtown District, but it is not on Pier Plaza or on a lot with direct water frontage, west of Hermosa Avenue.

To develop an opinion of the subject area land value, as if vacant and available to be developed to its highest and best use, we utilize the sales comparison approach. This approach develops an indication of value by researching, verifying, and analyzing sales of similar properties.

Our sales research focused on transactions within the following parameters:
 Location: High demand and limited supply in the area result in a lack of vacant land parcels.

Most land sales involve redevelopment plans for previously improved sites. Furthermore, the pandemic led to a decrease in commercial land sales due to concerns about restrictions on retail use during 2020 and 2021. Due to the lack of recent transactional activity in the immediate vicinity of the subject, our search parameters were expanded to include commercial properties along the Pacific coast including areas as far as Santa Monica to the north and Torrance to the south.
 Size: For purposes of our analysis, we have based a hypothetical property on a typical site that would be developed with a parking garage. In this analysis, we use 30,000 square feet as the point of comparison.
 Use: Commercial zoning in the Downtown District.
 Transaction Date: We initially searched for transactions that occurred within the last year, however, there were limited transactions. As previously mentioned, there is very little undeveloped land in the high-demand areas located near the coast. Demand has outpaced supply for many decades and development opportunities are rare. As a result, we searched for sales that occurred from October 2017 to present. We did this to ensure that we could maintain a data set with a focus on geographical relevance.

For this analysis, we use price per square foot as the appropriate unit of comparison because market participants typically compare sale prices and property values on this basis. The most relevant sales are summarized in the following table.

The land valuation is based on property likely be east of Hermosa Avenue and is not considered to be beachfront.

Cost Approach – Land Valuation 29
In-Lieu Parking Fee Analysis
Summary of Comparable Land Sales - Hermosa Beach
No. Name/Address
Sale Date;
Status
Effective Sale
Price
SF;
Acres Zoning
$/SF
Land
1 901 Hermosa Ave Sep-22 $5,000,000 8,189 C-2, Downtown $610.58 Hermosa Beach Closed 0.19
Los Angeles County
CA
Tax ID: 4187-003-028
Grantor: Gregg Dahle, Trustee of the Gregg Dahle and Kay J. Dahle 2013 Family Trust for their Benefit Grantee: 901 Hermosa Avenue Partners LLC, a Delaware limited liability company 2 700-716 Santa Monica Boulevard Feb-22 $12,500,000 15,000 $833.33 Santa Monica Closed 0.34
Los Angeles County
CA
Tax ID: 4291-021-027
Grantor: Aldonard Properties, a California general partnership Grantee: 700 Santa Monica Los Angeles, LLC, a Delaware Limited Liability Company 3 1124 Broadway Sep-21 $1,500,000 2,138 MUBL, Mixed-Use $701.75 Santa Monica Closed 0.05
Los Angeles County
CA
Tax ID: 4282-031-001
Grantor: Jesus Lopez, Trustee of the Jesus Lopez Trust dated May 17, 2021 Grantee: ARSH Developments, LLC, a California limited liability company 4 2701 Pacific Coast Highway Jul-20 $4,850,000 23,958 C-3, General $202.44 Hermosa Beach Closed 0.55
Los Angeles County
CA
Tax ID: 4169-036-020
Grantor: Segal Family, LLC, a California limited liability company Grantee: Sepulveda Blvd. Properties, LLC, a California ** 5 Lincoln Boulevard E/O Sunset Avenue Jan-19 $4,000,000 7,760 C2, Commercial $515.46 Venice Closed 0.18
Los Angeles County
CA
Tax ID: 4243-018-031
Grantor: MMOF Venice Parking, LLC, a California limited liability company Grantee: Lincoln, LLC, a Delaware limited liability company 6 1106 The Strand Jun-17 $9,154,000 11,564 C-2, Downtown $791.59 Hermosa Beach Closed 0.27 Commercial
Los Angeles County
CA
Tax ID: 4187-005-025
Grantor: Stacy Siroon Haviland, who acquired title as Stacy Haviland Day Grantee: 1106 The Strand, LLC, a Delaware, limited liability company Subject 5,465 C-2
In-Lieu Parking Fee Analysis 0.13
Hermosa Beach, CA
NV, Neighborhood
Village

Cost Approach – Land Valuation 30
In-Lieu Parking Fee Analysis
Comparable Land Sales Map

Cost Approach – Land Valuation 31
In-Lieu Parking Fee Analysis
Land Sale 1
901 Hermosa Ave
Land Sale 1
901 Hermosa Ave
Land Sale 2
700-716 Santa Monica Boulevard
Land Sale 2
700-716 Santa Monica Boulevard
Land Sale 3
1124 Broadway
Land Sale 3
1124 Broadway

Cost Approach – Land Valuation 32
In-Lieu Parking Fee Analysis
Land Sale 4
2701 Pacific Coast Highway
Land Sale 4
2701 Pacific Coast Highway
Land Sale 5
Lincoln Boulevard E/O Sunset Avenue
Land Sale 5
Lincoln Boulevard E/O Sunset Avenue
Land Sale 6
2701 Pacific Coast Highway
Land Sale 6
2701 Pacific Coast Highway

Cost Approach – Land Valuation 33
In-Lieu Parking Fee Analysis
Factors of Comparison
The sales are compared to the subject and adjusted to account for material differences that affect value. Adjustments are considered for the following factors, in the sequence shown below.

Factors of Comparison
Effective Sale Price Accounts for atypical economics of a transaction, such as demolition cost, expenditures by the buyer at time of purchase, or other similar factors. Usually applied directly to sale price on a lump sum basis.

Real Property Rights Fee simple, leased fee, leasehold, partial interest, etc.

Financing Terms Seller financing, or assumption of existing financing, at non-market terms.

Conditions of Sale Extraordinary motivation of buyer or seller, assemblage, forced sale, related parties transaction.

Market Conditions Changes in the economic environment over time that affect the appreciation and depreciation of real estate.

Location Market or submarket area influences on sale price; surrounding land use influences.

Access/Exposure Convenience to transportation facilities; ease of site access; visibility from main thoroughfares; traffic counts.

Size The relationship that often exists between parcel size and unit value.

Shape and Topography Primary physical factors that affect the utility of a site for its highest and best use.

Zoning Government regulations that affect the types and intensities of uses allowable on a site.

Beach Proximity The distance associated with beach exposure, as this characteristic is typically associated with higher foot traffic and increased demand.

Entitlements The specific level of governmental approvals attained pertaining to development of a site.

Improvements The contributory influence and utility of structural improvements and their ability to be occupied or used prior to redevelopment.

Economic Characteristics Elements related to the transaction of a sale that influence the price based on their specific impact on the buyer and/or seller.

Market Conditions
According to metrics analyzed in our market analysis and interviews with market participants, sale prices in the retail market over recent years have increased by between 2% to 3% annually.

Transactional activity has remained relatively low for commercial retail land sales and, while vacancy has stabilized, rent has only seen slight increases due to the low inventory. In consideration of market

Cost Approach – Land Valuation 34
In-Lieu Parking Fee Analysis
participant opinions and the results of our market analysis, we conclude that the market has increased at a rate of 2.5% annually from the earliest sale in our data set.

Location
Efforts were made to include sales in proximate locations to the subject property. Due to the relatively low number of transactions for land, this resulted in the utilization of sales in neighboring market areas with similar characteristics, including Santa Monica and Venice. The following table compares the average retail submarket rent per square foot per month, which is then converted into a qualitative adjustment for the subsequent grid. The data was abstracted from CoStar Market Analytics.

Location Adjustments
Item Property Submarket
Indicate
d Market
Rent/SF % Change
Qualitative
Difference
Subject Downtown District Beach Cities $59.71
Sale 1 901 Hermosa Ave Beach Cities $59.71 0.00% Similar Sale 2 700-716 Santa Monica Boulevard Santa Monica $70.97 -15.87% Superior Sale 3 1124 Broadway Santa Monica $70.97 -15.87% Superior Sale 4 2701 Pacific Coast Highway Beach Cities $59.71 0.00% Similar Sale 5 Lincoln Boulevard E/O Sunset Avenue Marina Del Rey/Venice $62.31 -4.17% Superior Sale 6 1106 The Strand Beach Cities $59.71 0.00% Similar Source: CoStar Submarket Analytics
We have concluded that sales 2, 3, and 5, which are located in either Santa Monica or Venice, are located in superior markets. Sales 1, 4, and 7 are all located in Hermosa Beach and as such do not require an adjustment for location.

Descriptions of Land Sales
Land Sale 1 is the sale of an improved retail property that sold for commercial land value in the city of Hermosa Beach. The rectangularly shaped site is 0.19 acres, or 8,189 square feet, in size and is located at 901 Hermosa Avenue. The property encompasses the entire block between 10th Court and 9 th Street. The site is zoned C-2, or General Commercial, and is surrounded by supporting retail uses along the arterial, with residential properties along the local roads. The property is one block from the beach on the primary north-south arterial in Hermosa Beach. The agent for the sale stated that the property was sold off-market, and that the building was in poor condition. He stated that the buyer paid land value and intends to redevelop the property. He stated that the buyer was ultimately responsible for demolition costs and this was mostly offset by the fact that it was rented at the time of sale, and capable of generating carrier income prior to redevelopment. The FAR of the existing structural improvements at the time of sale was 0.95:1.

Land Sale 2 is the sale of an improved multi-tenant retail property that sold for commercial land value in the city of Santa Monica. The rectangularly shaped site is 0.34 acres, or 15,000 square feet, in size and is located at 700-716 Santa Monica Boulevard. The property is located at the northeast corner of Santa Monica Boulevard and 7th Street. The site is zoned NV, or Neighborhood Village, and is

Cost Approach – Land Valuation 35
In-Lieu Parking Fee Analysis
surrounded by mixed-use and commercial retail uses along the arterial, with high density residential uses along the local roads. The property is approximately half a mile northeast of the beach. The property had improvements at the time of sale. The agent stated that the property sold for land value and that the buyer plans redevelop the site but will maintain the short-term leases until the entitlements for redevelopment are complete. He also stated that the buyer is responsible for the demolition and plans to develop the site with a 60-unit multifamily property with ground-floor retail.

The FAR of the existing structural improvements at the time of sale was 0.67:1. There are no atypical adverse conditions that impacted the sale price of the property.

Land Sale 3 is the sale of a property that sold for commercial land value in the city of Santa Monica.

The rectangularly-shaped site is 0.05 acres, or 2,138 square feet, in size and is located at the northeast corner of Broadway and 11th Court or between Santa Monica Boulevard and Colorado Avenue. The site is zoned MUBL, or Mixed-Use Boulevard Low, and is surrounded by commercial office of the southwest and low to medium density residential uses in all other directions. This property is just under a mile northeast of the beach. The agent stated that the buyer plans to redevelop the site with a potential mixed-use development with ground floor retail and that there were no atypical adverse conditions that impacted the sale price of the property. The FAR of the existing structural improvements at the time of sale was 0.37:1 and the agent stated that the property sold for land value. The improvements were a heavily depreciated single family residence.

Land Sale 4 is the sale of an improved restaurant property that sold for commercial land value in the city of Hermosa Beach. The rectangularly-shaped site is 0.55 acres, or 23,958 square feet and is located mid-block along Pacific Coast Highway, between Gould Avenue and 30th Street. The site is zoned C-3, or General Commercial Zone, and is surrounded by retail uses on all sides. This property is located on a major arterial road in the area but does not have proximity to the beach. The property is approximately a half mile northeast of the beach. The property was previously utilized as a Round Table Pizza but was vacant at the time of sale. According to the agent, the is being utilized as a cafeteria for the nearby Skechers headquarters, until they eventually gain entitlements for the property and redevelop the site. The property was built in 1967 and the agent stated that the property was in fair shape, but with low lot coverage. The FAR of the existing structural improvements at the time of sale was 0.25:1. There were no atypical adverse conditions that impacted the sale price of the property.

The location of this site is not within the more desirable Downtown District of Hermosa Beach.

Land Sale 5 is the sale of vacant commercial land located in the Venice neighborhood of the city of Los Angeles. The rectangularly shaped site is 0.18 acres, or 7,760 square feet, in size and is located midblock on an arterial road between two local roads, Flower Avenue and Sunset Avenue. The property is zoned C2, or Commercial, and is surrounded by residential to the north as well as retail uses on all other sides and along Lincoln Boulevard, a major arterial in the region. The property is approximately one mile northeast of the beach. The site was vacant at the time of sale and represented a rare development opportunity in the area.

Land Sale 6 is the sale of an improved restaurant property that sold for commercial land value in the city of Hermosa Beach. The rectangularly shaped site is 0.27 acres, or 11,564 square feet, in size and encompasses the entire block of 11th Street along the north side between Beach Drive and the Strand.