Hermosa Beach City Council
January 27, 2026

the fact that any one or more section(s) or provision(s) may be declared invalid or unconstitutional or contravened via legislation.

SECTION 6. Certification. The City Clerk shall certify to the passage and adoption of this Resolution; cause the same to be entered among the original resolutions of the City; and make a minute of the passage and adoption thereof in the records of the proceedings of the City Council in the minutes of the meeting at which time same is passed and adopted.

SECTION 7. Effective Date. This Resolution is effective immediately upon adoption.

PASSED, APPROVED and ADOPTED on this 27th day of January 2026. ____________________________________________________________________________ Rob Saemann
PRESIDENT of the City Council and MAYOR of the City of Hermosa Beach, CA ATTEST: APPROVED AS TO FORM:
________________________________ ________________________________ Myra Maravilla Jason Baltimore
City Clerk Interim City Attorney

CITY OF

HERMOSA BEACH

HOUSING ELEMENT

POLICY PLAN
2021-2029
Adopted December 21, 2021
Re-adopted (with revisions) August 8, 2023
Revisions (January, May, and June 2024)

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Hermosa Beach 2021-2029 Housing Element
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023 Revised January, May, June 2024
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Contents
I. Introduction................................................................................................................................. I-1 A. Purpose of the Housing Element ......................................................................I-1 B. Scope and Content of the Housing Element..................................................I-1 C. Public Participation ...........................................................................................I-2 D. Consistency with Other Elements of the General Plan...................................I-2 II. Housing Policy Plan ................................................................................................................... II-1 A. Housing Element Issues and Policies ...............................................................II-1 B. Housing Programs.............................................................................................II-4 C. Quantified Objectives....................................................................................II-19 D. Summary of AFFH Actions.............................................................................. II-19 List of Tables
Table II-1 Quantified Objectives 2021-2029..................................................................... II-19 Table II-2 Affirmatively Furthering Fair Housing Summary Actions................................ II-199

Hermosa Beach 2021-2029 Housing Element
Housing Policy Plan – CERTIFIED August 1, 2024 Adopted December 21, 2021/ August 8, 2023 Revised January, May, June 2024
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Hermosa Beach 2021-2029 Housing Element I Introduction
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I. INTRODUCTION
A. Purpose of the Housing Element
The Housing Element describes the City’s needs, goals, policies, programs and objectives regarding the preservation, improvement, and development of housing in Hermosa Beach. The Element reflects community housing needs in terms of affordability, availability, adequacy, and accessibility. The Element describes the City’s strategies for addressing housing needs over the 2021-2029 period and identifies specific programs to address those needs.

The Housing Element is the City’s official municipal response to the State Legislature’s declaration that adequate housing for all economic segments of the community is a matter of statewide importance that must be addressed by all levels of government. The 2021 Housing Element update provides Hermosa Beach with the opportunity to plan for the existing and future housing needs in the community, and identifies strategies and programs to address those needs.

B. Scope and Content of the Housing Element
The California Legislature has recognized the role of local general plans and particularly the Housing Element in implementing statewide housing goals to provide decent and adequate housing for all persons. The California Department of Housing and Community Development (HCD) also has adopted detailed guidelines regarding the scope and content of housing elements, including the following major components:
• An analysis of demographic and housing characteristics and trends (Technical Report, Chapter I);
• An evaluation of resources, including land, financial, and administrative resources, available to address the City’s housing goals (Technical Report, Chapter II);
• A review of potential constraints, both governmental and non-governmental, to meeting housing needs (Technical Report, Chapter III); • The Housing Policy Plan addressing the City’s identified housing needs, including housing issues, policies, programs and quantified objectives (Chapter II of this document);
• An evaluation of the appropriateness and effectiveness of previous policies and programs in achieving the City’s objectives, and the progress in implementing Housing Element programs (Technical Report, Appendix A); • A parcel-specific inventory of vacant and underutilized suitable sites for additional housing (Technical Report, Appendix B); and
• A description of the public participation process during the preparation and adoption of the Housing Element (Technical Report, Appendix C).

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C. Public Participation
Public participation is an important component of the planning process, and this update to the Housing Element has provided residents and other interested parties numerous opportunities to be involved in the preparation of the element. Public meetings to discuss housing needs and policy options were conducted by the Planning Commission and City Council, and notices of all meetings were published in advance of each meeting. The draft Housing Element was made available for review at City Hall and posted on the City’s website and was also circulated to housing organizations representing the interests of lower-income persons and those with special housing needs. After receiving comments on the draft Housing Element from the State Housing and Community Development Department, a proposed final Housing Element was prepared and made available for public review prior to review by the Planning Commission and adoption by the City Council.

Appendix C provides additional information regarding opportunities for public involvement in the preparation of this Housing Element update, as well as a list of persons and organizations who were invited to participate.

D. Consistency with Other Elements of the General Plan
The Housing Element must be consistent with other elements of the General Plan, which was last updated in 2017. Housing Element policies and programs are closely correlated with the development policies contained in the Land Use Element, which establishes the location, type, and intensity of land uses throughout the city. The Land Use Element determines the number and type of housing units that can be constructed in the various land use districts. Areas designated for commercial and industrial uses create employment opportunities, which in turn, create demand for housing. The Circulation Element establishes the location and scale of streets, highways and other transportation routes that provide access to residential neighborhoods. Because of the requirement for consistency among the various General Plan elements, the 2021 Housing Element update included a review of other General Plan elements to ensure that consistency is maintained.

Government Code Section 65302 also specifically requires that the Safety and Conservation Elements be reviewed concurrent with each Housing Element update.

SB 1087 of 2005 requires cities to provide a copy of their Housing Elements to local water and sewer providers, and also requires that these agencies provide priority hookups for developments that include lower-income housing. These agencies have been invited to participate in the Housing Element update process and the Housing Element will be provided to these agencies immediately upon adoption.

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II. HOUSING POLICY PLAN
The purpose of this Housing Policy Plan is to identify policies and programs that will help the City in addressing its housing needs during the 2021-2029 planning period. This section includes the following components:
• Section A identifies the housing issues facing Hermosa Beach and establishes guiding policies for addressing those issues;
• Section B describe specific program actions the City will take consistent with established policies;
• Section C establishes quantified objectives for the construction of new housing, rehabilitation of existing housing in need of repair, and the conservation of existing affordable housing.

A. Housing Element Issues and Policies
This section establishes the City’s housing policy framework. Section 65583(c) of the California Government Code requires that actions and policies included in the Housing Element address five key issue areas:
• The manner in which the City will assist in the conservation of existing housing resources, particularly affordable housing;
• The City’s strategy in assisting in the development of new housing opportunities; • How the City intends to provide adequate sites to achieve a variety and diversity of housing types;
• How the City proposes to remove governmental constraints that may impact the preservation and development of housing; and,
• How the City may help to promote equal housing opportunities.

Issue Area 1 - Conservation of Existing Affordable Housing The City’s proximity to the Pacific Ocean and its desirability as a place to live and visit contributes to the high land and housing costs relative to the surrounding region. The City, nevertheless, has been successful in maintaining its more affordable housing through the adoption of ordinances and special land use regulations. The City works proactively to preserve and maintain the existing housing resources in the City, including affordable housing.

This commitment is underscored by the policies listed below.

Policy 1.1 The City will continue to encourage the maintenance and improvement of the existing housing stock within the local neighborhoods.

Policy 1.2 The City will assist in the preservation and enhancement of the housing supply available to senior citizens.

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Policy 1.3 The City will work to minimize the conversion of existing lower-cost rental housing in multiple-family developments to condominiums.

Policy 1.4 The City will investigate potential sources of funding and other incentives that will assist in the preservation and renovation of older housing units.

Policy 1.5 The City will continue to implement its current code enforcement procedures as a means to ensure the conservation and
maintenance of existing housing resources in the City.

Issue Area 2 - New Affordable Housing Development
The City’s ability to directly fund the construction of affordable housing is constrained due to budget limitations. In addition, the construction of affordable public housing within the coastal zone would not represent an efficient expenditure of public money, given the high land and development costs. As a result, the City continues to be an active participant in the development of more affordable housing through land use regulations and other incentives. The City of Hermosa Beach will continue to assist in the development of new housing for all income groups through the following policies.

Policy 2.1 The City will continue to promote the development of a variety of housing types and styles to meet the existing and projected housing needs of all segments of the community.

Policy 2.2 The City will continue to encourage the development of safe, sound, and decent housing to meet the needs of varying income groups.

Policy 2.3 The City will continue to implement the land use policy contained in the City’s General Plan, which provides for a wide range of housing types at varying development intensities.

Policy 2.4 The City will continue to support and promote home ownership in the community.

Policy 2.5 The City will continue to cooperate with other government agencies, citizen groups, and the private sector, in order to assist in meeting the existing and future demand for housing.

Policy 2.6 The City will encourage the addition of ADU and JADU units as a strategy to provide new housing units for low- and moderate-income households.

Issue Area 3 - Provision of Adequate Sites for New Housing The majority of the city was developed during the early 1900s. More intensive development has continued up to the present time. There are few vacant parcels of land remaining in the city, and the majority of the residential construction that has occurred involved the “recycling” of older structures. Nevertheless, the City of Hermosa Beach will continue to

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explore potential sites for residential development as a means to achieve a variety and diversity of housing types.

Policy 3.1 The City will evaluate new development proposals in light of the community's environmental resources, the capacity of public infrastructure to accommodate the projected demand, and the presence of environmental constraints.

Policy 3.2 The City will continue to evaluate the General Plan and zoning to ensure residential development standards are adequate to serve future development.

Policy 3.3 The City will continue to review current zoning practices for consistency with the General Plan as a way to facilitate new mixeduse development within or near the commercial districts.

Issue Area 4 - Removal of Governmental Constraints to Housing In previous years, the City has been successful in the conservation of housing, especially affordable housing, through the implementation of land use ordinances and regulations.

A key component of the City’s housing policy is to assist in the development of more affordable housing with the use of incentives and other measures. The City of Hermosa Beach will remain committed to the removal of governmental constraints through the following policies.

Policy 4.1 The City will continue to abide by the provisions of the Permit Streamlining Act as a means to facilitate the timely review of residential development proposals.

Policy 4.2 The City will work with prospective developers and property owners to assist in their understanding of the review and development requirements applicable to residential development in the city.

Policy 4.3 The City will continue its efforts to educate the community regarding the development standards contained in the City of Hermosa Beach Zoning Ordinance, including the ability to provide ADU and JADU units on residential properties.

Policy 4.4 The City will continue to evaluate its Zoning Ordinance and General Plan and remove governmental constraints related to development standards. These may include, but not be limited to, parking requirements, allowing affordable housing on commercial sites, new standards for mixed-use development, lot consolidation incentives, and senior housing requirements.

Issue Area 5 - Equal Housing Opportunity
Federal and State laws prohibit housing discrimination based on an individual’s race, ethnicity, religion or other characteristics. Enforcement of fair-housing laws generally occurs through the courts, though persons being discriminated against often lack the

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resources to obtain the necessary legal protections. As a result, alternative means to obtain assistance must be made available. Towards this end, the City will continue to cooperate with other public agencies and non-profit organizations providing assistance in ensuring equal housing opportunities for all.

Policy 5.1 The City will continue to provide information and referral services to regional agencies that counsel people on fair housing and landlordtenant issues.

Policy 5.2 The City will continue to cooperate with the County Housing Authority related to the provision of rental assistance to lowerincome households.

Policy 5.3 The City will continue to cooperate with other cities and agencies in the area in investigating resources available to provide housing for the area's homeless population.

Policy 5.4 The City will support the expansion of shelter programs with adjacent cities and local private interests for the temporary accommodation of the homeless population.

Issue Area 6 – Sustainable Housing Development
The City works to promote sustainability and energy conservation in a number of ways.

Plan Hermosa, the City’s General Plan, establishes a blueprint for sustainability and a lowcarbon future, and provides a framework within which City regulations, programs, and projects work in unison to ensure that land use, transportation, and other aspects of City operations support sustainable development and energy conservation goals. Specifically for the residential sector of the community, the issue of energy conservation can be addressed at several levels: community-wide land use and transportation planning, building technology in both new construction and rehabilitation or remodeling of existing structures, and through lifestyle options such as walking and cycling. This is further supported by water conservation and sustainable neighborhood design.

Policy 6.1 The City will support sustainable residential development through land use planning, building technology and lifestyle options.

B. Housing Programs
The programs listed below describe the actions the City intends to take to address the policy issues discussed above. The City’s main challenge in accommodating new residential development is its lack of vacant land. As a result, the vast majority of new housing development must occur through the “recycling” of older structures and redevelopment of underutilized parcels. The lack of financial resources, coupled with high land and development costs, will continue to be a constraint to the development of new affordable housing. As a result, the focus of these programs is on strategies to assist the private market in the development of affordable housing.

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Issue Area 1 - Conservation of Existing Affordable Housing

1. Code Enforcement
Program Description: Chapter 8.28 of the Municipal Code provides for the abatement of safety and nuisance conditions relating to private property. To implement this requirement, the Code Enforcement Program emphasizes the following:
• The City actively pursues Municipal Code violations on a complaint basis, with particular emphasis being placed on those areas clearly exposed to public view;
• All necessary steps are taken to ensure that violations are corrected in an expeditious and voluntary manner;
• Where appropriate, property owners are informed of available assistance programs for lower-income persons who may not be able to afford needed improvements or corrections; and
• The City utilizes misdemeanor criminal prosecution only when attempts to gain voluntary compliance have failed.

The Code Enforcement Program implements those sections of the Municipal Code related to property maintenance, including zoning, property maintenance, illegal units, trash container regulations, construction without permits, and sign regulations. The Code Enforcement Officer assists and makes recommendations to other City departments, such as conducting inspections of business licenses, home occupation offenses, and obstructions in public rights-of-way.

Timing: This program is in place and will continue through the planning period.

Funding: General Fund.

2. Conservation of Existing Affordable Housing
Program Description: This program provides for the ongoing maintenance and conservation of the Marine Land Mobile Home Park located at 531 Pier Avenue. The 60- space park provides housing for extremely-low-, very-low- and low-income households.

The Hermosa Court Recreational Vehicle Park with 19 pads at 725 10th Street also provides transitional housing space for those persons or households in transition from an RV to a more permanent home. The City's MHP Zoning District requires Planning Commission approval in order to add or delete spaces in the park, which helps to preserve affordability by discouraging conversion from single- to double-wide spaces. In 2013 the Mobile Home Park received over $111,000 of City funds and $1.2 million through the State’s Mobilehome Park Resident Owner Program (MPROP) and the Marineland Community Association, Inc., the resident association, purchased the park, ensuring the long-term security of this important affordable housing resource.

In addition to mobile homes, existing apartments provide an important source of housing at lower cost than ownership housing. To reduce the potential impact of condominium conversions on low- and moderate-income residents of converted condominiums,

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Chapter 17.22 of the Municipal Code establishes requirements including first right of refusal and relocation assistance for tenants.

Timing:
• To ensure that the amount of relocation assistance remains sufficient, review and update relocation reimbursement requirements annually should condominium conversion become a trend again in the future. (There has not been any condominium conversion in the City for more than a decade.) Funding: General Fund.

Issue Area 2 - New Affordable Housing Development

3. Density Bonus and Other Incentives
Program Description: State law requires cities to grant a density bonus and other incentives for qualifying affordable or senior housing developments. Section 17.42.100 of the Zoning Ordinance establishes standards and procedures for implementing State Density Bonus Law. In addition to State requirements, the City has adopted additional incentives that allow increased density when small parcels are combined to create a larger residential building site.

State density bonus law has been amended from time to time to encourage the development of affordable and senior housing. The City has been implementing the State density bonus law. To provide clarity and help incentivize affordable housing development, the City will revise its density bonus regulations (Municipal Code Sec.

17.42.100) to comport with current State law. In addition, the City will inform developers and contractors of this incentive program through brochures at the public counter and information posted on the City’s website.

Timing:
• As part of the comprehensive Zoning Ordinance update, revise the City’s Density Bonus regulations by the end of 2023.
• Continue to make information available on the density bonus program through brochures and the City website throughout the planning period.

Funding: City General Fund.

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4. Affordable Housing Development Outreach and Assistance Program Description: This program includes investigation of potential funding sources and administrative support to assist private and non-profit organizations in the development and/or provision of affordable housing. The City will investigate the feasibility of expanding CDBG funding and Section 8 rental vouchers to qualifying households. The Section 8 program is one of the major sources of housing assistance for very-low- and extremely-lowincome households. If the City is successful in obtaining increased CDBG funding and/or expanding Section 8 rental vouchers for residents, this information will be posted in the Community Center, on the City’s website, in handouts provided in the information kiosk in the City Hall lobby, and in the local library. Brochures will also be provided to local service clubs including the local “Meals on Wheels” program, local dial-a-ride service, the local recreation center, and emergency shelters in the area.

The City will also provide incentives such as priority processing, fee waivers and deferrals, and modified development standards to projects with low- or moderate-income units, and will assist in preparing and processing grant applications for affordable housing projects to support the development of such units. Project sponsors will be encouraged to include units for extremely-low-income households where feasible. As part of the 2021 Housing Element update the City consulted with a variety of housing organizations to identify potential actions the City could take to facilitate the development of affordable housing, including to extremely-low-, very-low- and low-income households.

Timing:
• Annually pursue funding available to expand affordable housing opportunities in the City, especially housing for special needs populations, including extremely low income households.
• Annually contact developers to explore affordable housing opportunities, especially for developers with experience in special needs housing. • As affordable units become available, conduct Affirmative Fair Marketing to agencies and organizations that serve low and moderate income households and special needs populations in the South Bay region.

Funding: This program will be financed through the City’s General Fund and grant funds.

5. Facilitate Efficient Use of Sites that Allow High-Density Residential Development
Program Description: This program will facilitate affordable housing development on sites that allow high-density residential development including reducing constraints posed by small lot sizes.
a. While the City does not rely on small sites to meet its lower income RHNA, the City will continue to facilitate lot consolidation by:
• Assisting affordable housing developers in identifying opportunities for lot consolidation using the City’s GIS system and property database;

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• Continuing to expedite processing for lot consolidations processed concurrently with planning entitlements;
• Continuing to provide a graduated density bonus for lower-income housing on small lots consolidated into a single building site according to the following formula (Zoning Ordinance Sec. 17.42.170):

Combined Parcel Size Allowable Base Density*
Less than 0.50 acre 33 units/acre

0.50 acre to 0.99 acre 34.7 units/acre (5% increase)

1.00 acre or more 36.3 units/acre (10% increase)
*Excluding density bonus
b. The City will continue to facilitate affordable housing development by:
• Facilitating pre-application meetings;
• Implementing incentives under the Density Bonus law;
• Reducing property development standards (e.g. reduced setbacks, reduced parking standards) for small developments below the threshold of Density Bonus law when affordable units targeted to the elderly or persons with disabilities are provided;
• Allowing deferral or waiver of City fees necessary to make the project costeffective; • Facilitating permit processing so that developers can take advantage of funding opportunities;
• Expediting permit processing through concurrent review through the planning and building processes;
• Promoting programs on the City’s website and at the Planning Counter and biennially notify affordable housing developers of the City’s housing incentives.

Timing:
• By the end of 2023, publicize the lot consolidation incentives on the City’s website, at the Planning counter, and by notice to affordable housing providers. • Annually contact developers to communicate the various city incentives available to facilitate affordable housing development. • By the end of 2025, conduct an assessment of the City’s progress in providing affordable housing in the community. If the City is not making meaningful progress in its affordable housing goals, the City will develop additional incentives and strategies to expand affordable housing opportunities by the end of 2026. Additional incentives may include increasing the graduated densities for lot consolidation.

Funding: General Fund. Accessory Dwelling Units

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6. Accessory Dwelling Units
Program Description: Accessory dwelling units (ADUs) provide an important source of affordable housing for seniors, young adults, care-givers and other low- and moderateincome segments of the population. In recent years, the State Legislature has adopted extensive changes to ADU law in order to encourage housing production. Among the most significant changes is the requirement for cities to allow one ADU plus one “junior ADU” on single-family residential lots by-right subject to limited development standards. The City further incentivizes ADU development by allowing a second ADU in lieu of the JADU. This flexibility facilitates the development of a range of ADU sizes to accommodate the diverse housing needs in the community. The City will review new legislation each year and update ADU regulations as necessary to ensure conformance with current State law.

Timing:
• Facilitate the development of 95 ADUs over the eight-year planning period, over the RHNA projection of 64 ADUs.
• Monitor legislation and update City ADU regulations as necessary to maintain consistency with State law by the end of 2023.
• Provide ADU standards, guidance, and resources on City website by the July 2024. For example, provide links to the California Housing Finance Agency (CalFHA) ADU grant program that provides $40,000 in pre-development funds to qualified homeowners.
• By the end of 2025, develop incentives to facilitate the construction of ADUs.

Incentives may include pre-approved plans, expedited review, assigned staff or office hours for ADU review and consultation, and/or reduced fees. • By the end of 2025, amend the Zoning Code to allow an additional JADU (beyond current allowance under State and local laws) within the existing square footage of larger homes. A survey of completed homes in the past four years revealed an average primary unit size of 3,500 square feet. The City proposes to allow an additional JADU in primary units over 3,000 square feet on single-family (R-1) lots, only when the additional JADU results in a net additional dwelling unit. The City aims to add 15 additional units using this method between 2026 and 2029.
• Monitor the trend of ADU development every other year beginning in 2025. If by 2027, the ADU activities are not trending to meet the Housing Element goal, develop additional incentives (such as pursuing State funds or partnering with nonprofits) by July 2028 to further facilitate ADU development, or to identify replacement sites or rezoning, if necessary, to address any sites capacity shortfalls.
• Promote the use of Housing Choice Vouchers for ADUs. Create a Fair Housing Factsheet on landlord responsibility as part of ADU application packet by July 2024.

Funding: General Fund and grant funds, if available.

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7. Land Value Recapture
Program Description: When land is rezoned to allow higher-intensity uses, the value of that property typically increases. Land value recapture refers to a policy requiring that a portion of the increased value be dedicated to a public benefit, such as affordable housing.

The City adopted the Housing Element on December 21, 2021, including the Land Value Recapture Program as Program 7. This Program was introduced early in the Housing Element discussions and has been a part of the Housing Element update since inception.

The Program was carried through to the revised adopted Housing Element on August 8, 2023. The Housing Element indicates that the City will perform a feasibility analysis on the Land Value Recapture Program.

The premise of the Land Value Recapture Program is that properties that benefit from zoning actions to allow for residential development increase in value. In the South Bay region where Hermosa Beach is located, there is a decreasing desire to redevelop commercial properties and instead an increased desire to redevelop properties into mixed use or all residential. This desire correlates to property values. The Program levies a fee onto any residential development on properties that benefited from a zoning action that expanded their development ability. However, the property is exempt from the fee if the proposed residential development includes 15% very-low-, 15% low-, or 25% moderateincome units.

The City worked with a real estate advisory company to evaluate the economic feasibility of Land Value Recapture. The analysis included sample business proformas indicating that the City’s proposed Land Value Recapture fee did not render development infeasible (i.e., that an acceptable return on investment would be possible), and even further that in some cases, construction affordable units and taking advantage of density bonus provisions amplified the return on investment.

Timing:
• Conducted feasibility study concurrent with rezoning in 2023 (see Program 9) and begin implementation in 2024.

Funding: General Fund and grant funds, if available.

8. Housing Trust Funds
Program Description: Housing trust funds are a dedicated source of financial assistance for affordable housing and can be funded through a variety of mechanisms, such as governmental grants, loans, charitable contributions, development fees, and land value recapture requirements (see also Program 7).

The City has joined the South Bay Housing Trust Fund managed by the South Bay Council of Governments (SBayCOG). Specifically, the City has contributed SB 2 funds toward the Trust Fund.

Timing:

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• Annually pursue funding to provide for affordable housing, especially funding for special needs populations. As funding permits, continue to participate in the South Bay Housing Trust Fund.

Funding: General Fund or grant funds, if available.

Issue Area 3 - Provision of Adequate Sites for New Housing

9. Adequate Sites to Accommodate Housing Needs
Program Description: State law requires cities to ensure that their land use plans and development regulations identify adequate sites with appropriate zoning to accommodate housing needs assigned through the Regional Housing Needs Assessment (RHNA) process.

The City’s RHNA allocation is described in Section I.H of the Housing Element Technical Report, and an analysis of the City’s potential sites for additional housing is presented in Appendix B of the Technical Report. For the 6th cycle RHNA, the City has been allocated a RHNA of 558 units (232 very low, 127 low, 106 moderate, and 93 above moderate income units). With projected ADUs of 64 units over eight years, the City has a remaining RHNA obligation of 494 units (221 very low, 99 low, 102 moderate, and 72 above moderate income units). These units are being accommodated on sites rezoned or amended to allow mixed use and residential uses. At the State default minimum density of 20 units per acre, up to 24.7 acres of rezoning would be required. However, the City proposes to rezone two one-acre city-owned properties at a minimum density of 34 units per acre, and the majority of identified parcels will be rezoned to a minimum density of 25.1 units per acre.

Overall, 23.5 acres of rezoning were identified.

The sites analysis concluded that amendments to current land use and zoning designations are necessary in order to fully accommodate the RHNA. Specifically, the City identified a number of sites with potential for redevelopment into residential or mixed use residential development. An estimated 302 units can be accommodated on parcels larger than 0.5 acre (151 very low, 76 low, 44 moderate, and 31 above moderate income units). In addition, Sites 1 and 2 (St. Cross), while comprising of multiple parcels, are under common ownership and function as an integral campus. These two sites can accommodate 33 very low and 13 low income units. These large parcels and St. Cross site can accommodate the majority of the City’s remaining lower income RHNA, with 47 units (less than 15 percent) of the remaining lower income units required to be accommodated on consolidated sites.

As discussed before, all small sites used for lower income RHNA are contiguous, under common ownership and with no more than two owners. Moderate and above moderate income housing can be developed on small parcels without consolidation.

This program describes the actions the City will take to ensure that adequate sites are designated consistent with Government Code Sec. 65583(c)(1)(A) and 65583.2. • The City will process General Plan and zoning amendments, including the required CEQA analysis, for the selected sites. The rezoned sites shall include the following components pursuant to Government Code Sec. 65583.2(i):

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o Permit owner-occupied and rental multi-family uses by-right for developments in which 20 percent or more of the units are affordable to lower-income households.
o Permit the development of at least 16 units per site. o Permit a minimum of 20 dwelling units per acre.
o Ensure that either: a) at least 50 percent of the shortfall of low- and very-lowincome regional housing need can be accommodated on sites designated for exclusively residential uses; or b) if accommodating more than 50 percent of the low- and very-low-income regional housing need on sites designated for mixed uses, all sites designated for mixed uses must allow 100 percent residential use and require that residential uses occupy at least 50 percent of the floor area in a mixed-use project.
• The City will report on the status of this program each year as part of the Annual Progress Report.

Timing:
• In November 2023, the City completed Zoning map and text amendments to provide adequate sites:
o Rezone City-owned properties (Sites 10 and 11) from M-1 and O-S to Public Facilities with an allowable residential density of 34-50 units per acre. o Rezone Sites 1 and 2 (St. Cross Church properties) from R-1/R-2 to R-2A with an allowable residential density of 22-25 units per acre. o Amend Zoning Ordinance to add residential and mixed use development as permitted uses to C-2, C-3, SPA-7, SPA-8, and SPA-11 RHNA sites with an allowable residential density of 25.1-33 units per acre. o Amend Zoning Ordinance to establish a formal procedure to monitor for the No Net Loss of capacity for accommodating the RHNA, pursuant to SB 166. o Amend Zoning Ordinance to establish the replacement housing requirements when redevelopment occurs on RHNA sites where existing units occupied by or deed-restricted for lower income households are demolished.
• In November 2023, the City amended the General Plan land use designation for Sites 1 and 2 in the inventory from Low Density to Medium Density Residential. • By the end of July 2024, complete text corrections regarding the rezoning above to ensure compliance with the minimum density of 20 du/ac. • Facilitate affordable housing development on City-owned sites:
o Develop and release a Request for Proposal by the end of 2024 to solicit a public/private partnership for affordable housing (including housing for special needs populations). If disposition of site(s) is considered, the City will ensure compliance with the Surplus Land Act.

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o Complete design work, environmental review and associated approvals by the end of 2025.
o Identify affordable housing developer(s) to partner with on affordable housing projects meeting the RHNA allocation of 100 affordable units on the City sites (30 very low, 45 low, and 25 moderate income units) on City-owned sites.
o If the City is not successful in pursuing affordable housing on these sites and construction has not started by 2027, the City will pursue alternative actions (such as identifying alternative sites) by the end of 2028. • Beyond the sites required to accommodate the City’s RHNA, the City also embarked on an effort starting in 2022 to introduce residential development along all major commercial corridors. As of November 2023, the City completed the zoning text changes creating mixed use (residential/ commercial) development standards in C-2 and C-3 zones, and allows mixed use/residential only in the newly created the Housing Element Sites Overlay (Sites Inventory sites) with a density range of 25.1 to 33 du/ac. By the end of 2026, the City will create additional mixed use overlays to include other areas in the major commercial corridors, with a minimum density of at least 20 du/ac.

The City anticipates this will result in 100 units above the Housing Element Sites Overlay capacity.

Funding: General Fund; grant funds.

Issue Area 4 - Removal of Governmental Constraints to Housing

10. Housing for Persons with Special Needs
Program Description: The Zoning Ordinance encourages the provision of housing for persons with special needs, including regulations and procedures related to group homes, emergency shelters, transitional/supportive housing and persons with disabilities. The City is in the process of updating the Zoning Ordinance. Specific changes to address special needs housing include:
• Emergency Shelters: Revise parking standard based on staffing level only.

Designate R-3 (Multi-Family Residential) as zone for emergency shelters by right without discretionary review. Expand the definition of emergency shelters to include interim housing options pursuant to State law (AB 2339), including bridge housing, navigation centers, and respite and recuperative care. Review and revise or remove the bed limit based on consultation with service providers. • Transitional and Supportive Housing: These uses are currently permitted in all residential zones as similar uses in the same zones. Revise the Zoning Ordinance to similarly permit transitional and supportive housing in all zones that permit residential uses.

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• Supportive Housing: Recent changes to State law (AB 2162 of 2018) require that supportive housing (up to 50 units) meeting specific requirements be a use by-right in zones where multi-family and mixed uses are permitted, including non-residential zones permitting multi-family uses. Furthermore, if the development is located within half-mile from transit, no minimum parking can be required. • Residential Care Facilities (for seven or more persons): Revise the CUP review process for large care facilities to an Administrative Permit in all residential zones, with a lower fee, and establish findings for approval that are objective and provide certainty in outcomes similar to other residential uses of the same type in the same zone.
• Low Barrier Navigation Center: In 2019 the State Legislature adopted AB 101 establishing requirements related to local regulation of low barrier navigation centers, which are defined as “Housing first, low-barrier, service-enriched shelters focused on moving people into permanent housing that provides temporary living facilities while case managers connect individuals experiencing homelessness to income, public benefits, health services, shelter, and housing.” Revise the Zoning Ordinance to permit low barrier navigation centers meeting specified standards byright in areas zoned for mixed use and in nonresidential zones permitting multi-family uses.
• Reasonable Accommodation: In the October 2023 Zoning Ordinance amendment, the City removed the public hearing requirement for reasonable accommodation requests and required finding relating to traffic and parking impacts. However, the finding relating to neighborhood character remained. In November 2023, the City adopted the Housing Element Zoning Text Amendment and removed the finding regarding neighborhood character to ensure objectivity. (This action is completed.) • Live/Work Housing: The City’s Economic Subcommittee studied the increased need for live/work housing. Develop strategies for providing live/work housing and 15- minute neighborhoods.

Timing:
• Zoning Code amendments by the end of 2024.
• Develop strategies for live/work housing by 2025.

Funding: General Fund and grants

11. Streamline Housing Permit Processing
Program Description: As part of the comprehensive Zoning Ordinance update the City will evaluate methods to simplify the housing development review process such as eliminating the conditional use permit requirement for multi-family, condominium and mixed-use developments and reviewing the Precise Development Plan (PDP) process including what is reviewed, typical findings and approval procedures by zone and housing type, and impacts as potential constraints on housing supply and affordability. Consistent with new transparency laws, zoning, development standards and fees are posted on the City website. The Zoning Ordinance update will also include revisions to streamline PDP process

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and develop objective standards to minimize constraints on housing supply and affordability. In addition, the City will establish procedures to process SB 35 projects.

Timing:
• Zoning Ordinance update by the end of 2023 to:
o Streamline the Precise Development Plan review process as discussed in the Housing Element Technical Report.
o Develop object standards for project review.
• By the end of 2023, establish SB 35 procedures.
• Annually update City website to provide current information on zoning, development standards and fees.
• By the end of 2024, update Subdivision Ordinance to address CUP requirement for condominium projects.

Funding: General Fund and grants.

12. Remove Governmental Constraints
Program Description: As part of this Housing Element update, the City has evaluated the effectiveness of its development standards and procedures in facilitating residential and mixed use developments. Specifically, the City’s parking standards for multi-family housing does not support a variety of unit types and sizes.

Subsequent to the adoption of the Housing Element, the City will review any Coastal Land Use Plan policies that must be updated and submit to the California Coastal Commission for certification. The timeline will be more apparent once the amendments have been submitted.

Timing:
• As part of comprehensive Zoning Ordinance update by the end of 2023, revise parking standards to facilitate a variety of unit sizes and types, such as smaller units, senior units, and mixed use developments, and offer alternative options such as shared parking arrangements for mixed use development. (This task has already been completed as part of the October 2023 Zoning Ordinance update. Parking for small units (zero to one-bedroom) has been reduced from two spaces per unit to 1.5 spaces per unit. Transitional and supportive housing, which is usually smaller in size, the parking requirements mirror that of regular residential uses, except when such housing is located within one-half mile of transit. In that case, no parking is required.) By the end of 2024, the City will revise the parking standards to remove the guest parking requirements. The currently adopted parking standards will remain but will be indicated as inclusive of guest parking.
• By 2024, submit updated Coastal Land Use Policies to the CCC for certification.

Funding: General Fund and grants.

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Issue Area 5 - Equal Housing Opportunity

13. Affirmatively Furthering Fair Housing
Program Description: As a participating city in the Los Angeles County CDBG program, Hermosa Beach has access to services for fair housing outreach, education, and counseling on housing discrimination complaints. The City will continue to advertise the fair housing program through placement of fair housing service brochures at the public counter, at the Senior Center, through the City's newsletter, 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 and housing resources at public counters, libraries, and on the City’s website and at Senior Center. Expand the City’s outreach efforts to reach a broader audience by:
o Advertising housing-related initiatives and programs in newspapers that have broader circulation beyond city limits (such as the Daily Breeze. o Making hard copies of documents to assist the technology challenged. o Expanding notifications to agencies and organizations that serve residents in the South Bay region.
• Conduct at least one public meeting annually to discuss housing-related issues.

Conduct public meetings at suitable times, accessible to persons with disabilities, and near public transit. The utilizes multi-media platforms to outreach to lower and moderate income populations and persons with special needs. The City partners with community agencies for outreach at community events on weekends and at public locations. For community workshops and meetings, the City offers to the degree possible hybrid attendance depending on the setting.

Usually, this includes a minimum of two (2) methods of attendance consisting of in-person and one other method. 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.

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• Collaborate with home share programs and promote programs to residents.

Home share programs available to South Bay residents include:
o Home Share South Bay, a program offered by the South Bay Cities Council of Governments (SBCCOG), is a community solution that matches homeowners with renters seeking affordable housing in the South Bay. o Affordable Living for the Aging (ALA) offers a home share program. ALA screens, matches, and monitors two people to share a home based on living preferences and compatibility. Arrangements may be rent or a combination of rent and daily living support such as cleaning, cooking, or transportation.

Timing: This program is ongoing and will continue through the planning period.

Funding: General Fund.

14. Neighborhood Improvement
Given the City’s compact size, the City’s strategies for AFFH Placed-Based Strategies for neighborhood improvements are focused on ensuring that every area in the City receives systematic investment while also ensuring that every area in the City is connected to amenities, such as services, businesses, and recreation across the City as well as regionally.

Certain programs are available for senior and disabled residents as well.

Community Development Block Grant (CDBG)
The City uses CDBG funds to further mobility across all areas of the City by retrofitting existing intersections for disabled-accessible crosswalks and ramps.

Safe Routes to School
The City, in concert with the Hermosa Beach City School District, has a Safe Routes to School program. The Program includes educational materials, outreach, and a reporting system to ensure that routes to school are safe.
https://www.hermosabeach.gov/our-government/city-departments/police/programstips/safe-routes-to-school Aging in Place
The City of Hermosa Beach offers a tax rebate and certain exemptions (sewer, lighting assessment, utility user tax) for income-qualified elderly or disabled residents. https://www.hermosabeach.gov/our-government/finance-department/financeadministration/rebates The City offers a House Check program for senior citizens, including those with Alzheimer’s to ensure that these residents are safe. https://www.hermosabeach.gov/ourgovernment/police-department/not-alone-program-alzheimer-checklist-vacation-housechecks Beach Cities Health District (BCHD) has a Care Management Program to ensure senior receive services they need to continue living in their home.

BCHD also pairs volunteers up with senior to assist them on errands so they can continue to live in their homes.

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Maintenance of Property
Senior Grant Program – Los Angeles County Development Authority – senior homeowners for $15,000. Examples are livability and age in place, including deferred maintenance repairs.

BCHD’s Senior Resources includes assisting seniors with mental health issues that may affect an individual’s ability to maintain and upkeep their home.

Capital Improvement Program (CIP)
The City’s CIP projects which are under currently construction are focused on public amenities that are used by all residents, including repair of the Municipal Pier, accessible beach routes, sidewalk and accessible curb ramps, and repair of City park restrooms. https://hermosabeach.maps.arcgis.com/apps/Shortlist/index.html?appid=d4 f16ff6c37544a0b8bd0dc0a725452f
The City’s 5-year CIP includes repair of a wide variety of public amenities. https://hermosabeach.maps.arcgis.com/apps/Shortlist/index.html?appid=d4f16ff6c3754 4a0b8bd0dc0a725452f
Clean-up Events
The City benefits from clean-up events through sponsoring and also in partnership with many organizations. The City of Hermosa Beach, Friends of the Parks-Hermosa Beach, the Surfrider Foundation, are some examples. These clean-up events restore public amenities for residents. Recent events headed by the Mayor of Hermosa Beach included a painting of classrooms in a park facility, new landscaping at park facilities, and beach clean-ups.

Timing:
• Annually during budgeting process, prioritize improvements and services that have the most urgent need.

Funding: General Fund and grant funds.

Issue Area 6 – Sustainable Housing Development

15. Sustainable Housing Development
Program Description: In 2017 the City adopted a comprehensive update to the General Plan (PLAN Hermosa). One of the primary themes of the new General Plan is community sustainability. Chapter 4: Sustainability + Conservation establishes state-of-the-art policies to improve sustainability and energy conservation in residential development. Those policies will continue to guide City decision-making in land use decisions and the development review process.

Funding: General Fund.

Timing: Throughout the planning period.

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C. Quantified Objectives
Table II-1 describes the City’s quantified objectives for new construction, rehabilitation and conservation during the planning period.

Table II-1
Quantified Objectives 2021-2029

Income Category

Totals
Extremely
Low Very Low Low Moderate
Above
Moderate
New construction 116 116 127 106 93 558
Rehabilitation 10 10
Conservation (1) 60 60

1. Mobile homes
D. Summary of AFFH Actions
The table below summarizes the City’s actions to affirmatively further fair housing. This table supplements the descriptions, actions, and timing for citywide programs with targeted actions for AFFH. Implementation of the housing programs and detailed shown in the table below are both considered commitments of the City of Hermosa Beach.

Table II-2
Affirmatively Furthering Fair Housing Summary Actions
Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Fair Housing Enforcement and Outreach – High Priority
Contributing Factors:

Lack of fair housing service records
Lack of fair housing testing
Lack of monitoring
Lack of targeted outreach
Program 4:

Affordable
Housing
Development
and Outreach
Make information available to
affordable housing organizations
regarding residential
development opportunities.

Annually Agencies and
organizations
serving low
and moderate
income and
special needs
households in
the South Bay
region
Facilitate the
development
of 359 lower
income units
Pursue funding available for
affordable housing development.

Annually
Conduct Affirmative Fair
Marketing as affordable housing
units become available.

As units
become
available

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Program 13:

AFFH
Facilitate public education and
outreach by posting informational
flyers on fair housing and housing
resources at public counters,
libraries, on the City’s website,
and social media (FB, Twitter,
Instagram, Next Door, and Tik
Tok), and paid advertising such as
Daily Breeze – engage a more
diverse population, especially
relying on social media platforms
that have a younger audience.

Annually Citywide (all
highest
resource
areas)
Facilitate the
development
of 558 units,
including 359
lower income
units
City newsletter (about 8,000
subscribers)
Bi-weekly
Conduct public meetings to
discuss housing-related issues.

Conduct 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.

At least once a
year
Encourage community and
stakeholder engagement during
development decisions.

At least once
during
development
review process
Conduct Affirmative Fair
Marketing as affordable housing
units become available.

As units
become
available
Agencies and
organizations
serving low
and moderate
income and
special needs
households in
the South Bay
region
New Opportunities in High Resource Areas – High Priority Contributing Factors:

High land, rental, and ownership housing costs
Availability of affordable housing
Program 3:

Density Bonus
and Other
Incentives
Revise Density Bonus provisions
and make information available
on the density bonus program
through brochures and the City
website.

By the end of
2023
Citywide (all
highest
resource
areas)
Facilitate
construction of
359 lower
income units
Program 5:

Facilitate
Efficient Use of
Sites that Allow
High-Density
Residential
Development
Facilitate lot consolidation and
affordable housing development
through implementation of
strategies outlined in Program 5.
2021-2029 Multi-family
and mixed use
zones
Promote lot
consolidation
to facilitate
development
of 100 multifamily units

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Program 6:

ADUs
Monitor legislation and update
City ADU regulations as necessary
to maintain consistency with State
law.

By the end of
2023
Single-family
neighborhoods
Facilitate
construction of
95 ADUs,
including 15
additional
JADUs
Promote the use of Housing
Choice Vouchers for AUDs.

Create a fair housing factsheet to
be included in ADU application.

Amend Zoning Code to allow one
additional JADU on R-1 lots if the
primary unit is at least 3,000
square feet and the additional
JADU will result in a net increase in
units.

By the end of
2025
Program 9:

Adequate Sites
to
Accommodate
Housing Needs
Complete Zoning map and text
amendments to provide
adequate sites for RHNA.

By the end of
2023
Along
commercial
corridors
Accommodat
e 100% of the
shortfall of sites
to
accommodate
the city’s
remaining
housing need
of 359 units for
very low and
low income
households.

Housing Mobility– High Priority
Contributing Factors:

High land, rental, and ownership housing costs
Availability of affordable housing
Program 6:

ADUs
Promote the use of Housing
Choice Vouchers for AUDs.

Create a fair housing factsheet to
be included in ADU application.

By the end of
2023
Single-family
neighborhoods
Facilitate
construction of
95 ADUs
Amend Zoning Code to allow one
additional JADU on R-1 lots if the
primary unit is at least 3,000
square feet and the additional
JADU will result in a net increase in
units.

By the end of
2025
Program 9:

Adequate Sites
to
Accommodate
Housing Needs
By the end of 2026, the City will
broaden the overlay to include
the remaining sites in the major
commercial corridors. The City
anticipates this will result in 100
units above the Housing Element
Sites Overlay capacity.

By the end of
2026
Commercial
corridors
Facilitate
development
of 100 units
along
commercial
corridors

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Program 10:

Housing for
Persons with
Special Needs
Complete zoning code
amendments outlined in Program
10 to promote housing for special
needs groups.

By the end of
2023
City-owned
property and
along
commercial
corridors
Assist with the
construction of
100 units for
special needs
populations,
including 50
units of senior
housing on
City-owned
property
Economic Subcommittee studied
increased need for live/work –
develop strategies for live/work
housing, co-working space, and
15-minute neighborhood, etc.

By 2025 Along
commercial
corridors and in
light
manufacturing
areas
Facilitate the
development
of 50 live/work
units
Program 13:

Affirmatively
Furthering Fair
Housing
Facilitate public education and
outreach by posting informational
flyers on fair housing and housing
resources at public counters,
libraries, and on the City’s website
and at Senior Center. Expand the
City’s outreach efforts to reach a
broader audience by:
o Advertising housing-related
initiatives and programs in
newspapers that have broader
circulation beyond city limits
(such as the Daily Breeze.
o Making hard copies of
documents to assist the
technology challenged.
o Expanding notifications to
agencies and organizations that
serve residents in the South Bay
region.

By the end of
2024
Single-family
neighborhoods
Provide
referrals to
services to 20
households,
with the goal
of reaching a
broader
population via
other media
platforms.

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Collaborate with home share
programs and promote programs
to residents. Home share
programs available to South Bay
residents include:
o Home Share South Bay, a
program offered by the South Bay
Cities Council of Governments
(SBCCOG), is a community
solution that matches
homeowners with renters seeking
affordable housing in the South
Bay.
o Affordable Living for the Aging
(ALA) offers a home share
program. ALA screens, matches,
and monitors two people to share
a home based on living
preferences and compatibility.

Arrangements may be rent or a
combination of rent and daily
living support such as cleaning,
cooking, or transportation.

Program 14:

Neighborhood
Improvements
Pursue community development
activities and neighborhood
improvements:
• CDBG mobility access
improvements at
crosswalks and ramps
• Safe routes to school
Annually during
budgeting
process
Area with lower
median
household
income and
along
commercial
corridors and
manufacturing
areas where
future housing
is expected
Pursue 16
improvement
projects
AFFH:

Affirmative
Marketing
Require the project develops of
affordable housing projects or
projects with affordable units to
implement an Affirmative Fair
Marketing Plan to outreach to a
diverse population, extending
outreach to nearby communities
in the South Bay, especially to
workers in the City who do not live
in the City. These affirmative
marketing materials will include
contact information for housing
service providers (such as the
home share programs) and nonprofit housing organizations that serve lower income tenants in the
surrounding region.

As affordable
units are
developed
South Bay Achieve 30% of
future
occupants of
affordable
units from
outside
Hermosa
Beach,
including those
who work but
do not live in
the City

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Develop materials for Hermosa
Beach residents who may be
seeking tenants for their ADUs,
which will be provided to ADU
applicants at the time they apply
for a building permit or ADU
permit. These affirmative
marketing materials will include
contact information for housing
service providers (such as the
home share programs) and nonprofit housing organizations that serve lower-income tenants in the
surrounding region. Interested
residents can use these materials
to find prospective tenants in a
larger market area beyond city
limits, including residents of all
races, ethnicities, ages, and
abilities
By December
2025
Single-family
neighborhoods
and high
resource areas
(citywide)
Achieve 30% of
future ADU
occupants
from outside
Hermosa
Beach,
including those
who work but
do not live in
the City
Housing Mobility
Monitoring
Annually review overall progress
and effectiveness in April and
include information in annual
report to HCD. If the City is not on
track to meet its housing mobility
goals by 2027, the City will
consider alternative land use
strategies and make necessary
amendments to zoning or other
land use documents to facilitate
a variety of housing choices,
including but not limited to,
strategies that encourage missing
middle zoning (small-scale multiunit projects up to four-plexes), adaptive reuse, within six months,
if sufficient progress toward this
quantified objective is not being
met.

Annually in
April
Citywide 95 ADUs/JADUs
(including 15
additional
JADUs)
Home match
for 20
households

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
Place-Based Strategies for Neighborhood Improvement – Medium Priority Contributing Factors:

Unaffordable rental prices
Availability of affordable housing
Private discrimination
Program 14:

Neighborhood
Improvements
Pursue community development
activities and neighborhood
improvements:
• Aging in place services,
including tax rebates and
exemptions for
assessments
• Promote property
maintenance assistance,
such as LACDA senior
repair grants
• Capital improvements for
neighborhood amenities
Annually during
budgeting
process
Area with lower
median
household
income and
along
commercial
corridors and
manufacturing
areas where
future housing
is expected
Provide 20 tax
exemptions for
seniors and
disabled
households
Conduct 8
neighborhood
cleanup
events
Tenant Protection and Anti-Displacement– High Priority
Contributing Factors:

Lack of fair housing service records
Lack of fair housing testing
Lack of monitoring
Lack of targeted outreach
Program 2:

Conservation of
Existing
Affordable
Housing
Review and update relocation
reimbursement requirements for
relocation assistance.

Annually Citywide 100% of
displaced
households
compensated.

Program 8:

Housing Trust
Funds
Annually pursue funding to
provide for affordable housing
and as funding permits, continue
participation in the South Bay
Housing Trust Fund
Annually South Bay
Region
Contribute to
the
development
of 5 affordable
housing units in
the region.

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Program Specific Commitment Timeline Geographic
Targeting
Eight-Year
Metric
AFFH:

Homelessness
Plan
Continue to implement the City’s
Homelessness Plan, including
outreach for persons
experiencing homelessness:
• PATH provides dedicated
outreach teams for
homeless assistance, and
also connects individuals
with medical and mental
healthcare, interim
housing, veteran services,
employment services and
providing benefits
enrollment and
advocacy.
• Through PATH, the City
has an Outreach Hotline.
• The LA County MET
performs outreach and
assessments on
individuals with mental
health needs, and
provides linkages to
services.
• City staff meets quarterly
with regional outreach
representatives from
PATH and Harbor
Interfaith Services to
share relevant
information, assess
service connections
made, and identify
community “hot spots”
where additional
attention is needed.
• In partnership with
SBCCOG, facilitate
landlord
outreach/education
regarding opportunities
for housing individuals atrisk of homelessness
Ongoing Citywide with
emphasis on
southwest
section of the
City
Assist 10
persons
experiencing
homelessness
through
outreach
efforts
annually.

Utilize local funds outlined in the
Homelessness Plan 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.

Ongoing Citywide with
emphasis on
southwest
section of the
City
Assist five
persons
experiencing
homelessness
annually.

CITY OF HERMOSA BEACH
ORDINANCE NO. ORD-24-1474

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HERMOSA

BEACH, CALIFORNIA, AMENDING THE HERMOSA BEACH MUNICIPAL

CODE TO IMPLEMENT THE LAND VALUE RECAPTURE PROGRAM FOR

AFFORDABLE HOUSING AND DETERMINE PURSUANT TO THE CALIFORNIA

ENVIRONMENTAL QUALITY ACT THAT THE PROJECT IS CONSISTENT WITH

THE PLAN HERMOSA ENVIRONMENTAL IMPACT REPORT

THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Section 17.39.050 (Land Value Recapture for Affordable Housing) is hereby added to Title 17 (Zoning) of the Hermosa Beach Municipal Code to read as follows:

17.39.50 Land Value Recapture for Affordable Housing
A. Sites designated as (--HE) that have underlying non-residential zones are subject to the City’s Land Value Recapture Program for Affordable Housing, as follows:

1. Proposed projects that are entirely non-residential are exempt.

2. Projects on sites with a Sites Inventory capacity are subject to the Land Value Recapture Program fee, as follows:
a. For sites on the Sites Inventory with a capacity of 5 or more units:

1. Projects proposing a minimum of 15% very-low income
units, 15% low-income units, or 25% moderate income
units, or combination thereof, (calculated from base
density) shall be exempt from the fee;

2. Projects proposing a portion of the above affordability requirements shall be subject to the corresponding
proportional amount of the fee.

3. Projects not proposing any affordable units shall be subject to the Tier 2 fee.
b. For sites on the Sites Inventory with a capacity of 1 to 4 dwelling units:

1. Projects constructing to minimum density and proposing at least 1 affordable unit (very low, low, or moderate) are exempt from the fee.

2. Projects not proposing any affordable units shall be subject to the Tier 1 fee.

DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B

B. The fee amounts for the Land Value Recapture Program for Affordable Housing shall be set by City Council resolution.

SECTION 2. Section 17.42.100(A)(3) of Title 17 (Zoning) of the Hermosa Beach Municipal Code is hereby amended as follows:

2. Compatibility. All affordable housing units shall be dispersed within market-rate projects. Affordable housing units within market-rate projects shall be comparable with the size and bedroom count, design, and use of market-rate units in appearance, use of materials, and finished quality. The design and appearance of the affordable housing units shall be compatible with the design of the total housing development and consistent with the surrounding neighborhood.

Forms, materials and proportions that are compatible with the character of the surroundings shall be used.

SECTION 3. Section 17.42.100(B)(2) of Title 17 (Zoning) of the Hermosa Beach Municipal Code is hereby amended as follows:

2. Applicability. The provisions of subsection (B)(1) of this section shall be applicable to residential projects of five (5) or more units, and senior citizen housing developments of at least thirty-five (35) units.

Additionally, projects proposing a percentage of moderate-income rental units equivalent to the percentage of for-sale moderate income units may utilize the corresponding density bonus allowance specified in Government Code Section 65915.

SECTION 4. Land Value Recapture Program. Regarding proposed Section

17.39.050, the City makes the following findings:

1. The City’s 2021-2029 Housing Element Sites Inventory identifies sites that may be used to meet the City’s Regional Housing Needs Assessment (RHNA) allocation. The City’s RHNA allocation consists of over 60 percent of units in the very low- and low-income categories.

2. Due to lack of available residentially zoned land, most of the sites in the Sites Inventory are on non-residentially zoned sites.

3. The City must amend the zoning in order to allow for residential or mixed-use development on non-residentially zoned sites.

4. The City’s Housing Element includes strategies to facilitate the creation of affordable housing, including very low-, low-, and moderate-income units.

5. There are currently no affordable housing units in the City.

DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B

6. As a part of the rezoning effort, the City wishes to capture land value associated with the zoning amendments which enable residential development on non-residentially zoned sites.

7. In accordance with California Government Code 66001, the City Council finds:
a. The purpose of the fee (if applicable) is to create much needed affordable residential units in the City.
b. Any fees paid would be to fund the creation of affordable residential units and any associated services required by those units (open space, residential amenities, etc).
c. The amount of the fee is calculated to be the equivalent cost of creating affordable residential units on-site, on nonresidentially zoned properties that now have the ability to include residential development. There is a reasonable
relationship to requiring properties that can now include residential development (and may be the bulk of the new residential units coming online in the City) to offset the lack of affordable units in each project with the fee.
d. The City has an established need for affordable housing, as supported by the adopted 2021-2029 Housing Element.

SECTION 5. Severability. If any section, subsection, subdivision, sentence, clause, phrase, or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision will not affect the validity of the remainder of this ordinance. The City Council hereby declares that it would have adopted this ordinance, and each and every section, subsection, subdivision, sentence, clause, phrase, or portion thereof, irrespective of the fact that any one or more sections, subsections, subdivisions, sentences, clauses, phrases, or portions thereof is declared invalid or unconstitutional.

SECTION 6. Effective Date. This Ordinance shall take effect thirty (30) days after its passage and adoption pursuant to California Government Code section 36937, or upon certification of the City’s 2021–2029 Housing Element (6th Cycle) by the California Department of Housing and Community Development, whichever is later.

SECTION 7. Certification. The City Clerk is directed to certify the passage and adoption of this Ordinance; cause it to be entered into the City’s book of original ordinances; make a note of the passage and adoption in the records of DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B

this meeting; and, within fifteen (15) days after the passage and adoption of this Ordinance, cause it to be published or posted in accordance with California law.

PASSED, APPROVED and ADOPTED on this 23rd day of January, 2024.

Mayor Justin Massey
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
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B

Intro: 12/12/2023
Adopt: 1/23/2024
ss
State of California )
County of Los Angeles )
City of Hermosa Beach )
March 4, 2024
Certification of Council Action
ORDINANCE NO. ORD-24-1474

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HERMOSA

BEACH, CALIFORNIA, AMENDING THE HERMOSA BEACH MUNICIPAL

CODE TO IMPLEMENT THE LAND VALUE RECAPTURE PROGRAM FOR

AFFORDABLE HOUSING AND DETERMINE PURSUANT TO THE

CALIFORNIA ENVIRONMENTAL QUALITY ACT THAT THE PROJECT IS

CONSISTENT WITH THE PLAN HERMOSA ENVIRONMENTAL IMPACT
REPORT
I, Myra Maravilla, City Clerk of the City of Hermosa Beach, California, do hereby certify that the above and foregoing Ordinance No. ORD-24-1474 was duly approved and adopted by the City Council of said City at its regular meeting thereof held on the 23rd day of January 2024 and passed by the following vote:

AYES: MAYOR MASSEY, MAYOR PRO TEM FRANCOIS, and

COUNCILMEMBERS SAEMANN, DETOY, AND JACKSON
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
_____________________________
Myra Maravilla,
City Clerk
DocuSign Envelope ID: EA241598-E47F-4FBE-A60C-B46E38E77E4B

STATE OF CALIFORNIA - BUSINESS, CONSUMER SERVICES AND HOUSING AGENCY GAVIN NEWSOM, Governor

DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT

DIVISION OF HOUSING POLICY DEVELOPMENT
651 Bannon St, Suite 400
Sacramento, CA 95811
(916) 263-2911 / FAX (916) 263-7453
www.hcd.ca.gov
August 1, 2024
Suja Lowenthal, City Manager
City of Hermosa Beach
1315 Valley Drive
Hermosa Beach, CA 90254
Dear Suja Lowenthal:

RE: City of Hermosa Beach’s 6th Cycle (2021-2029) Adopted Housing Element Thank you for submitting the City of Hermosa Beach’s Ordinance Number ORD-24- 1481 (Ordinance) that was adopted July 23, 2024 and received on July 30, 2024.

Pursuant to Government Code section 65585, the California Department of Housing and Community Development (HCD) is reporting the results of its review.

HCD is pleased to find the City has completed actions to address the requirements that were described in HCD’s July 12, 2024 review. The Ordinance was found to be substantially the same as the draft amendments HCD’s July 12, 2024 review determined met statutory requirements. As a result, the adopted element now substantially complies with State Housing Element Law (Gov. Code, § 65580 et seq) as of the date of this letter.

Additionally, the City must continue timely and effective implementation of all programs including but not limited to the following:
• Program 3 (Density Bonus and Other Incentives)
• Program 4 (Affordable Housing Development Outreach and Assistance) • Program 5 (Facilitate Use of Sites that Allow High Density Development) • Program 6 (Accessory Dwelling Units)
• Program 7 (Land Value Recapture)
• Program 9 (Adequate Sites to Accommodate Housing Needs) • Program 10 (Housing for Persons with Special Needs)
• Program 11 (Streamline Housing Permit Processing)
• Program 12 (Remove Governmental Constraints)
• Program 13 (Affirmatively Further Fair Housing)
• Program 14 (Neighborhood Improvement)

Suja Lowenthal, City Manager

The City must monitor and report on the results of these and other programs through the annual progress report, required pursuant to Government Code section 65400.

Please be aware, Government Code section 65585, subdivision (i) grants HCD authority to review any action or failure to act by a local government that it determines is inconsistent with an adopted housing element or housing element law. This includes failure to implement program actions included in the housing element. HCD may revoke housing element compliance if the local government’s actions do not comply with state law.

In addition, as part of Program 7 (Land Value Recapture), the City should monitor the effectiveness of the Program in facilitating development, including development affordable to lower and moderate-income households and impacts on financial feasibility of development. The City should monitor effectiveness at least every other year and make adjustments as appropriate to achieve the goals and objectives of the housing element, including addressing governmental constraints.

Several federal, state, and regional funding programs consider housing element compliance as an eligibility or ranking criteria. For example, the CalTrans Senate Bill (SB) 1 Sustainable Communities grant, the Affordable Housing and Sustainable Communities program, and HCD’s Permanent Local Housing Allocation consider housing element compliance and/or annual reporting requirements pursuant to Government Code section 65400. With a compliant housing element, the City now meets housing element requirements for these and other funding sources.

HCD appreciates the efforts and cooperation provided throughout both the housing element update and ordinance adoption processes. HCD wishes the City success in implementing its housing element and looks forward to following its progress through the General plan annual progress reports required pursuant to Government Code section 65400. If HCD can provide assistance in implementing the housing element, please contact Hilda Boyadjian, of our staff, at [email protected].

Sincerely,
Paul McDougall
Senior Program Manager

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-14
Table B-5
Sites Inventory
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
10 552 11th Place 4187-020-907 PF Public
Facilities
M-1 Light
Manufacturing
PF Public
Facility 34 50 1.00 Self-Storage - 25 25 - 50
FAR: 0.0
ILR: 0
Year Built: NA
Height: 1
This city-owned property currently has a
month-to-month lease for a public storage
facility. It is surrounded on two sides by
medium density housing. City is currently
working with a real estate development
analysis firm to determine potential publicprivate-partnership for housing development, including affordable housing.

Proposed General Plan and Public Facility
zoning is 34-50 units per acre, for a total
yield of 50 units. Potential RFP in 2025 and
construction in 2026.

Factors for Selection: a, d, e, f, g, h
Y City of HB
11 710 Pier
Avenue 4187-024-902 PF Public Facilities
O-S Open
Space
PF Public
Facility 34 50 1.00 Community Center 30 20 - - 50
FAR: 0.0
ILR: 0
Year Built: NA
Height: Mostly unoccupied land with only
16% of site with a 2-story building
This city-owned community center property
is currently under study by a real estate
development analysis firm to determine
potential public-private-partnership for senior
affordable housing development of up to 50
units. This site is ideal for senior housing due
to smaller units, reduced parking needs,
services offered at community center,
available onsite parking and proximity to
PCH bus transportation and grocery/drug
stores directly across Pier Avenue.

Y City of HB

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-15
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
Proposed General Plan and Public Facility
zoning will be changed to 34-50 units per
acre, for a total yield of 50 units. Potential
RFP in 2024 and construction in 2026 or
2027.

The Community Center building is two
stories and designated historic, and occupies

0.75 acre of the site. The rest of the site is
developed with surface parking, lawn area,
and tennis courts that could be reconfigured
or redeveloped to accommodate potential
residential development. The Sites Inventory
list this as one (1) acre, but there are actually

3.75 acres of space that is not currently
occupied by any building.

Factors for Selection: a, d, e, f, g, h
28 911 1st Street 4186-026-047 CC Community SPA-7
Specific Plan 25.1 33 0.46 Commercial
Parking - - - 12 12
FAR: 0.0
ILR: 0
Year Built: NA
Height: 0
Currently zoned commercial, this vacant
former parking lot site is surrounded on three
sides by low-to-medium density residential.

The owner is interested in developing 12 forsale units, likely at the moderate and abovemoderate income levels.

Factors for Selection: a, d, e, f, g, h
Y
1ST STREET

PARTNERS LLC

C/O LUIGI

SCHIAPPA

DEVELOPMENT
28 102 PCH 4186-026-804 CC Community SPA-7
Specific Plan 25.1 33 0.4 Utility Switching Station - - 5 5 10 FAR: 1.0 ILR: NA
Year Built: NA
Height: 2
Built in 1975, this telephone/ internet utility
structure and supporting parking lots once
served hundreds of employees and included
Y

GTE CALIF INC
SBE 201-19-
874B PAR 5
6PTS
28 102 PCH 4186-026-806 CC Community SPA-7
Specific Plan 25.1 33 0.2 Utility Switching Station - - 5 - 5 28 102 PCH 4186-026-801 CC Community SPA-7
Specific Plan 25.1 33 0.1 Utility Switching Station - - 3 - 3 28 102 PCH 4186-026-805 CC Community SPA-7
Specific Plan 25.1 33 0.09 Utility Switching Station - - 3 - 3

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-16
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
28 1st Street and
PCH 4186-026-800 CC Community SPA-7
Specific Plan 25.1 33 0.5 Commercial
Parking - - 6 7 13
a credit union, cafeteria, executive offices,
technician desks and large number of phone
operator desks. The building currently
houses telephone/internet equipment in
approximately 20% of the building with only a
handful of employees. The owner has
recently approached the City to discuss
adaptive reuse of this Art Deco building, with
equipment consolidation and introduction of
housing uses. At least two affordable
housing developers have expressed interest
in working with the property owner to convert
a portion of the building into residential units.

Of 1.49 acres, about 0.62 acre (27,000 sq.
ft.) is a surface parking lot. An existing
building with a footprint of about 0.85 acres
(37,000 sq. ft.) A 20,000 square-foot portion
of the building is 2 stories tall and currently
vacant. There is potential for conversion to
residential use. This building is 80% vacant
and only has telecommunications switching
equipment inside.

Factors for Selection: a, d, e, f, g
19 1103 Aviation
Boulevard 4185-017-015 GC Gateway
C-3 General
and Highway
Commercial

25.1 33 1.3 Multi-tenant
Commercial 24 8 - - 32
FAR: 1.0
ILR: 0.34
Year Built: 1964
Height: 0 and 1
Older 1975 commercial site with multiple
tenant retail. Developer inquired about
adding residential uses to commercial
property. Low density residential is adjacent
to the rear of the property.

These parcels are currently functioning as an
integral site.

Y

KENNARD,BAR

BARA S TR

BARBARA S

KENNARD

TRUST AND

HOROWITZ,RAL
PH TR

HOROWITZ
TRUST
19 1209 Aviation
Boulevard 4185-017-014 GC Gateway
C-3 General
and Highway
Commercial

25.1 33 0.5 Commercial
Parking 6 5 - - 11 Y SELECTIVE API

ONE LLC

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-17
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
Factors for Selection: a, d, f, g, h
19 1062
AVIATION 4186-001-008 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.12 Retail - Nursery - - 3 - 3
FAR: 0.7
ILR: 0.11
Year Built: 1964
Height: 1
Factors for Selection: d, e, f, g, h
- MARIE

SOLYMOSI
19 1062
AVIATION 4186-001-007 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.11 Retail - Nursery - - 2 - 2
2 1732 Monterey
Boulevard 4183-016-028
MD Medium
Density/
No Change
R-2 Two
Family
Residential
R-2A Medium
Density
Residential (22)
22 25 0.07 1 Unit - 1 - - 1 FAR: 0.5
ILR: 0.56
Year Built: 1923-1968
Height: Average 1 (5 0-story, 4 1-story, 6 2-
story)
The St. Cross church site consists of 15
parcels, developed with a church sanctuary
and administrative offices, education building
(24,000 sq. ft. footprint), 18 residential units
(with about 7,000 sq. ft. of 2-story
construction), and surface parking lots. The
surface parking areas and underdeveloped
properties on the site create potential for
additional residential units.

These parcels are currently functioning as
one campus.

Leaders at St. Cross Church reached out the
City to explore ways to add additional units
to their property portfolio, which includes 15
lots with historic church, 18 existing units and
parking lots. The church seeks to add
housing units for the dual purpose of
providing affordable housing to the
community and market rate units to help
offset costs for affordable units. The church
has rented units to homeless veterans,
refugees, and formerly to a women’s shelter.

Y

RECTOR,

WARDENS AND

VESTRYMEMBE

RS ST CROSS
PARISH

HERMOSA
BEACH
2 1736 Monterey
Boulevard 4183-016-029
MD Medium
Density/
No Change
R-2 Two
Family
Residential
R-2A Medium
Density
Residential (22)
22 25 0.07 1 Unit - 1 - - 1
2 1818 Monterey
Boulevard 4183-016-040
MD Medium
Density/
No Change
R-2 Two
Family
Residential
R-2A Medium
Density
Residential (22)
22 25 1.2 Religious
Institution 27 - - - 27
2 302 19th Street 4183-016-033
MD Medium
Density/
No Change
R-2 Two
Family
Residential
R-2A Medium
Density
Residential (22)
22 25 0.07
5 Units and
Wireless Comm.

Site
- - - - -
1 1900 Monterey
Boulevard 4182-019-001
MD Medium
Density/
No Change
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.08 3 Units - - - - -
1 1908 Monterey
Boulevard 4182-019-002
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.06 Private Parking
Lot 1 1 - - 2
1 1914 Monterey
Boulevard 4182-019-003
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.06 2 units - - - - -
2 1718 Loma
Drive 4183-016-011
MD Medium
Density/
MD Medium
Density
R-2 Two
Family
Residential
R-2A Medium
Density
Residential (22)
22 25 0.06 2 Units - - - - -
2 1722 Loma
Drive 4183-016-012
MD Medium
Density/
MD Medium
Density
R-2 Two
Family
Residential
R-2A Medium
Density
Residential (22)
22 25 0.06 1 Unit - 1 - - 1

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-18
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
2 1730 Loma
Drive 4183-016-035
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.1 1 Unit 1 1 - - 2
It is recommended to explore options to help
add affordable units, including consideration
of SROs or a Planned Unit Development
(PUD). St. Cross Church wrote a letter of
support for Housing Element recommending
RHD zoning.

Factors for Selection: a, d, e, g, h
2 1734 Loma
Drive 4183-016-036
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.1 2 Units - 1 - - 1
2 Loma Drive and
19th Street 4183-016-037
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.09 Private Parking
Lot 1 1 - - 2
2 Loma Drive and
19th Street 4183-016-038
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.1 Private Parking
Lot 1 2 - - 3
2 1854 Loma
Drive 4183-016-039
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.1 Private Parking
Lot 1 2 - - 3
2 1902 Loma
Drive 4183-023-022
LD Low
Density/
MD Medium
Density
R-1 SingleFamily
Residential
R-2A Medium
Density
Residential (22)
22 25 0.1 Private Parking
Lot 1 2 - - 3
5 565 Pier
Avenue 4183-018-013 CC Community SPA-11 Specific Plan 25.1 33 0.24 Multi-tenant Commercial - - 3 3 6 FAR: 0.6ILR: 0.57 Year Built: 1957-1963
Height: Mostly 1
This 32,000 sq. ft. site is developed with
about 16,000 sq. ft. of building footprint. A
7,600 sq. ft. portion (0.037 acre) of the
building is currently two stories.

Property owner communicated to staff
regarding interest in redevelopment.

Factors for Selection: a, d, e, g, h
Y
555 PIER

AVENUE LLC

C/O RIVIERA

CENTER MGMT
CO
5 555 Pier
Avenue 4183-018-015 CC Community SPA-11
Specific Plan 25.1 33 0.49 Multi-tenant
Commercial - - 6 6 12

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-19
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
4 517 Pier
Avenue 4183-018-018 CC Community SPA-11
Specific Plan 25.1 33 0.07 Offices - - - 1 1
FAR: 0.6
ILR: 0.57
Year Built: 1957-1963
Height: 1
Factors for Selection: d, e, g, h
-

WRAY,RICHAR
D AND

DOLORES TRS

WRAY FAMILY
TRUST
4 513 Pier
Avenue 4183-018-017 CC Community SPA-11 Specific Plan 25.1 33 0.07 Offices - - - 1 1 FAR: 0.7
ILR: 0.37
Year Built: 1939-1957
Height: Mostly 1 (8 1-story and 1 2-story)
These parcels are all being accessed from
Oak Street behind the buildings with no
individual driveways. Shared access is
conducive to consolidation.

Factors for Selection: d, e, f, g, h
- BAKER AND
BURTON
4 509 Pier
Avenue 4183-018-016 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1 - WWS PIER LLC 4 507 Pier
Avenue 4183-018-007 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1 - 4 REFOUA LLC 445 Pier
Avenue 4183-018-006 CC Community SPA-11 Specific Plan 25.1 33 0.07 Multi-tenant Commercial - - - 1 1 4 433 Pier
Avenue 4183-018-005 CC Community SPA-11 Specific Plan 25.1 33 0.07 Restaurant - - - 1 1 4 425 Pier
Avenue 4183-018-004 CC Community SPA-11
Specific Plan 25.1 33 0.07 Multi-tenant
Commercial - - - 1 1 -

CAPALDI, DINO

AND LEA TRS D

AND L CAPALDI
TRUST
4 405 Pier
Avenue 4183-018-001 CC Community SPA-11
Specific Plan 25.1 33 0.07 Personal
Services - - - 1 1 -

DANESHMAND,

MEHDI K AND

ROSA TRS

DANESHMAND

FAMILY TRUST
4 337 Pier
Avenue 4183-018-026 CC Community SPA-11
Specific Plan 25.1 33 0.08 Restaurant - - 2 - 2 -

SACKLEY,STUA

RT H TR

SACKLEY

FAMILY TRUST
4 321 Pier
Avenue 4183-017-025 CC Community SPA-11
Specific Plan 25.1 33 0.17
Personal Service
ground floor and
residential on
second floor
- - 4 - 4 - HB 321 PIER

AVE LLC
4 419 Pier
Avenue 4183-018-003 CC Community SPA-11
Specific Plan 25.1 33 0.05 Multi-tenant
Commercial - - - 1 1
FAR: 0.6
ILR: 0.38
Year Built: 1955
Height: 1
Y 419 PIER

AVENUE LLC

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-20
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
Owner provided preliminary plans for 4
residential units on 2nd and 3rd floor.

Currently zoned commercial only. Zoning
development standards to be determined
with residential standards.

Factors for Selection: a, d, e, f, g, h
4 411 Pier
Avenue 4183-018-002 CC Community SPA-11
Specific Plan 25.1 33 0.07 Personal
Services - - - 1 1
FAR: 0.5
ILR: 0.42
Year Built: 1945
Height: 1
Owner interested in adding small residential
units on 2nd and 3rd floors.

Factors for Selection: a, d, e, f, g, h
Y

AESTHETIC

HORIZONS INC

C/O JONATHAN
DAVID
7 338 Pier
Avenue 4187-011-054 CC Community SPA-11
Specific Plan 25.1 33 0.17 Office - - 4 - 4
FAR: 3.84
ILR: 1.65
Year Built: 2010
Height: 2
While this parcel appears newer, it is located
between blocks of parcels that exhibit
potential for conversion into mixed use
development. Office buildings also often
have higher FAR and ILR. However, with
increased remoting working, this site can
present opportunity for redevelopment. This
is included only as a RHNA buffer site and is
not needed to accommodate the City’s
moderate income RHNA.

Factors for Selection: b, d
-
BLAKE

HOLDINGS LLC

C/O DAVID

MCGOVERN
8 400 Pier
Avenue 4187-019-037 CC Community SPA-11 Specific Plan 25.1 33 0.21 Offices - - 5 - 5 FAR: 1.0
ILR: 0.60
Year Built: 1915-2010
Height: Primarily 1 (2 1-story and 1 2-story)
Potential for office conversion.
-
BLAKE

HOLDINGS LLC

C/O DAVID

MCGOVERN
8 420 Pier
Avenue 4187-019-003 CC Community SPA-11 Specific Plan 25.1 33 0.11 Restaurant - - 2 - 2 -

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-21
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
8 422 Pier
Avenue 4187-019-022 CC Community SPA-11
Specific Plan 25.1 33 0.23 Multi-tenant
Commercial - - 5 - 5 Factors for Selection: d, e, f, g, h PIER

PROPERTIES
LLC
9 506 Pier
Avenue 4187-020-020 CC Community SPA-11 Specific Plan 25.1 33 0.1 Offices - - 1 - 1 FAR: 1.0ILR: 0.27 Age of Structure: 1925-1966
Height: Average 1 (1 0-story, 1 1-story, 1 2-
story)
Potential for office conversion.

Factors for Selection: d, f, g, h
- SAILFISH

HOLDINGS LLC
9 514 Pier
Avenue 4187-020-032 CC Community SPA-11 Specific Plan 25.1 33 0.1 Private Parking Lot - - 1 - 1 -
REDDY,

DAMODER P

AND SOUMITRI

TRS PATI

FAMILY TRUST
9 526 Pier
Avenue 4187-020-017 CC Community SPA-11
Specific Plan 25.1 33 0.08 Retail Business - - 2 - 2
3 301 Pier
Avenue 4183-017-001 CC Community SPA-11
Specific Plan 25.1 33 0.19 Retail Business - - 5 - 5
FAR: 0.6
ILR: 0.87
Year Built: 1959
Height: 1
Factors for Selection: d, e, g, h
-

SANDY FEET

LLC C/O
DONALD

ENGLISH
6 308 Pier
Avenue 4187-011-012 CC Community SPA-11 Specific Plan 25.1 33 0.09 Retail Business - - 2 - 2 FAR: 0.7ILR: 1.0 Age of Structure: 1923-1944
Height: 1
Common ownership; currently functioning as
one site.

Factors for Selection: d, e, g, h
-
VISION
HERMOSA 1 0
6 LLC 318 Pier
Avenue 4187-011-013 CC Community SPA-11
Specific Plan 25.1 33 0.11 Retail Business
and Residential - - 2 - 2
18 1214 Owosso
Avenue 4185-015-021 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.1 1 Unit - - 3 - 3
FAR: 0.1
ILR: 0.16
Year Built: 1923
Height: 1
Common ownership; currently functioning as
one site.

Factors for Selection: d, e, f, g, h
- CASNER,CRAIG
18 1055 Aviation
Boulevard 4185-015-024 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.05 Vacant Land - - 1 - 1
26 530 6th Street 4188-018-028 CI Light
Industrial
M-1 Light
Manufacturing 25.1 33 0.33 Self-Storage - 4 4 - 8 FAR: 1.4ILR: 0.97 - HUNT, PRISCILLA TR

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-22
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
26 6th and
Cypress (530
6th St.)
4188-018-027 CI Light
Industrial
M-1 Light
Manufacturing 25.1 33 0.12 Self-Storage - 1 2 - 3
Year Built: 1946
Height: 2
2-story warehouse building with self-storage
use in residential adjacent neighborhood.

This is expected to be developed due to
zoning changes now allowing residential
development. Warehouse building existed in
the 1950s when the freight line ran through
town.

The four parcels are under common
ownership that function as a cohesive site
with shared access. The property is located
in the M1 zone where residential has never
been permitted. Rezoning to allow residential
uses in M1 will increase redevelopment
potential. This rezoning is not comparable to
past Housing Element programs, since there
were no rezoning programs nor were nonresidential sites contemplated at that point.

As demonstrated in Table B-2
Redevelopment Trends in the South Bay,
there are examples of storage facilities (RV
parking, truck storage, equipment rental
yard, etc) being converted to housing
developments. There is currently also a selfstorage site in Carson, within the South Bay, marketed for housing.

Factors for Selection: d, f, g

PRISCILLA

HUNT TRUST

C/O HUNT

ENTERPRISES
INC 26 Valley Drive
(530 6th St.) 4188-018-031 CI Light Industrial
M-1 Light
Manufacturing 25.1 33 0.17 Self-Storage - 2 2 - 4
26 Valley Drive
(530 6th St.) 4188-018-008 CI Light
Industrial
M-1 Light
Manufacturing 25.1 33 0.05 Self-Storage - - 1 - 1
27 2nd Street and
Pacific Coast
Hwy
4186-025-029 CC Community SPA-7
Specific Plan 25.1 33 0.08 Auto Repair - - 2 - 2
FAR: 0.4
ILR: 0.16
Year Built: 1905-1925
Height: <1 (2 0-story, 2 1-story)
Common ownership; currently functioning as
one site.
-
GRAND

PROPERTY
GROUP LLC 27 204 Pacific
Coast Hwy 4186-025-028 CC Community SPA-7 Specific Plan 25.1 33 0.15 Auto Repair - - 4 - 4 27 210 Pacific
Coast Hwy 4186-025-027 CC Community SPA-7 Specific Plan 25.1 33 0.08 Auto Repair - - 2 2

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-23
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
27 2nd Street and
Pacific Coast
Hwy
4186-025-002 CC Community SPA-7
Specific Plan 25.1 33 0.05 Auto Repair - - 1 - 1 Factors for Selection: d, e, f, g, h 25 747 5th Street 4188-030-002 SC Service SPA-7
Specific Plan 25.1 33 1 Auto Repair 20 5 - - 25 FAR: 0.4 ILR: 0.29
Year Built: 1923-1978
Height: 1
Factors for Selection: d, e, f, g, h
-

SMILE LLC AND

MARDIKIAN,
GEORGE
25 715 5th Street 4188-030-001 SC Service SPA-7
Specific Plan 25.1 33 0.37
Auto
Repair/Fitness
Center
- - - 9 9 -

FISHER,

ANDREW AND

ELIZABETH

AND FISHER,

ANDREW W
22 635 Pacific
Coast Hwy 4187-032-027 SC Service SPA-7 Specific Plan 25.1 33 1 Lumber Yard 20 5 - - 25 FAR: 0.2
ILR: 0.04
Year Built: 1988
Height: <1 (5 0-story, 1 1-story)
Site 24 is part of Site 22 owned by the same
party. Currently, the two sites function as an
integral site.

Factors for Selection: d, e, f, g, h
-

LEARNED,

MICHAEL CO

TR LEARNED
TRUST
24 709 6th Street 4187-033-022 SC Service SPA-7
Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2 24 721 6th Street 4187-033-021 SC Service SPA-7
Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2 24 723 6th Street 4187-033-020 SC Service SPA-7
Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2 24 Pacific Coast
Hwy and 6th
Street
4187-033-019 SC Service SPA-7
Specific Plan 25.1 33 0.06 Parking
Lot/Lumber Yard 1 1 - - 2
24 725 6th Street 4187-033-018 SC Service SPA-7
Specific Plan 25.1 33 0.06 Parking Lot/Lumber Yard 1 1 - - 2 23 600 Pacific
Coast Highway 4186-013-019 SC Service SPA-7 Specific Plan 25.1 33 0.36 Auto Repair 6 3 - - 9 FAR: 0.5ILR: 0.32 Year Built: 1923-1978
Height: Average 1 (1 0-story, 1 1-story, 1 2-
story)
Site 23 is 0.86 acre, consisting of three
parcels with two owners, currently
functioning as a cohesive site with shared
access, operating as interrelated auto
businesses. If consolidated, the site would
benefit from the City’s current lot
consolidation allowances. Most of the site is
automobile-related uses developed with only
surface automobile storage/parking or single-
- SMILE LLC
23 612 Pacific
Coast Highway 4186-013-018 SC Service SPA-7 Specific Plan 25.1 33 0.14 Fitness Studio 2 2 - - 4 23 620 Pacific
Coast Highway 4186-013-064 SC Service SPA-7
Specific Plan 25.1 33 0.36 Car Rental
Agency 6 3 - - 9 - NOOR ESTATE
LLC

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-24
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
story automobile-related buildings. There is
a two-story building with two small office
suites above. (At least one office was vacant
as of summer 2023). The two-story portion of
the building is approximately 1,400 square
feet.

Factors for Selection: d, e, f, g, h
13 1100 Pacific
Coast Highway 4185-011-039 GC Gateway
C-3 General
and Highway
Commercial

25.1 33 0.55 Retail Market 10 4 - 14
FAR: 0.7
ILR: 0.65
Year Built: 1977
Height: Average 1 (1 0-story, 1 2-story)
This is a 2.8-acre shopping center with one
owner and operating as a cohesive site and
would need to be consolidated for shared
access if redeveloped. About 0.9 acres are
occupied by buildings, with the rest (almost
two acres) being surface parking lot and
undeveloped land.

The site is developed with about 40,000
square feet of building area. All buildings are
single story with the exception of one 7,500
square foot portion which is two-story. This
two-story portion has been partially vacant
for over a year. This indicates that there are
no significant second-story encumbrances
on the development of the site for mixed use
or residential purposes.

The 2.8 acre center comprises two parcels.

One parcel is 0.55 acre, is coterminous with
the footprint of one building and is entirely
nestled (landlocked) in the 2.27 acre parcel.

As such, the entire site already functions as
one cohesive site with driveway access
points and internal circulation.

Y
BACON,

STEPHEN F CO

TR ROGER E

BACON DECD
TRUST 13 1100 Pacific
Coast Highway 4185-011-061 GC Gateway
C-3 General
and Highway
Commercial

25.1 33 2.27 Parking Lot/Pad
Shops 30 6 5 16 57

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-25
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
Factors for Selection: d, e, g, h
12 1601 Pacific
Coast Highway 4185-011-061 GC Gateway
C-2
Commercial
SPA-8

25.1 33 1.92
Personal
Services with
office space
24 8 8 8 48
FAR: 3.7
ILR: 1.80
Year Built: 1988
Height: 0
Given the high vacancy and the reliance on
one anchor (gym), there is a likelihood that
residential may be a viable conversion. The
building also has similar massing as other
nearby multi-family residential buildings (like
the adjacent one). This property has the
potential to redevelop through use of internal
conversion into residential.

Factors for Selection: b, d, g, h
-
1601 PCH LP

C/O SHAOUL
LEVY
14 900 AVIATION 4186-003-024 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.15 Retail - - 3 - 3
FAR: 0.8
ILR: 0.39
Year Built: 1940-1981
Height: <1 (6 0-story, 5 1-story, 1 2-story)
These sites are under common ownership
and is about 0.7 acres (30,000 sq ft). About
7,200 square feet of building footprint is two
stories.

Factors for Selection: d, f, g, h
- EDDIE TALBOT
TRUST
14 916 AVIATION 4186-003-030 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.21 Retail - - 5 - 5
14 950 AVIATION 4186-003-019 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.05 Parking Lot - - 1 - 1
14 950 AVIATION 4186-003-018 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.05 Parking Lot - - 1 - 1
14 950 AVIATION 4186-003-017 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.05 Parking Lot - - 1 - 1
14 950 AVIATION 4186-003-027 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.08 Parking Lot - - 2 - 2
14 950 AVIATION 4186-003-028 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.14 Multi-tenant
Commercial - - 3 - 3

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-26
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
15 1000
AVIATION 4186-002-020 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.07 Multi-tenant
Commercial - - 1 - 1
15 1014/1016
AVIAITION 4186-002-013 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.03 Multi-tenant
Commercial - - 1 - 1
15 1016
AVIAITION 4186-002-012 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.03 Parking Lot - - 1 - 1
15 1036
AVIATION 4186-002-011 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.03 Parking Lot - - 1 - 1
15 1036
AVIATION 4186-002-021 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.09 Multi-tenant
Commercial - - 2 - 2
16 1021
AVIATION 4185-014-015 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.11 Multi-family - - 2 - 2 FAR: 0.4
ILR: 0.57
Year Built: 1947-1962
Height: 1
Factors for Selection: d, e, g, h
- HBAVIATION
LLC 16 1029 AVAITION 4185-014-015 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.11 Multi-family - - 2 - 2
16 1035
AVAIATION 4185-014-001 CC Community
C-3 General
and Highway
Commercial

25.1 33 0.17 Multi-tenant
Commercial - - 4 - 4
29 824 1ST
STREET 4186-031-102 CC Community SPA-7
Specific Plan 25.1 33 0.13 Abandoned
Office Condos - - 3 - 3
FAR: 0.9
ILR: 0.18
Year Built: 1979
Height: 1
Factors for Selection: c, d, f, g, h
- KOCHDVPMT
LLC
21 700 Pacific
Coast Highway 4186-012-014 SC Service
C-3 General
and Highway
Commercial

25.1 33 0.33 Abandoned Auto
Repair - - 4 4 8
FAR: 0.4
ILR: 0.28
Year Built: 1945
Height: 1
Owner communicated to staff regarding
interest in redevelopment.

Factors for Selection: a. c, d, e, f, g, h
Y

LOWENSTEIN,J

OSEPH R AND

GAIL TRS

LOWENSTEIN
TRUST

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-27
Site/
Area
No.

Address APN Existing/
Proposed GP
Existing
Zoning
Proposed
Zoning
Min.

Den.

Max.

Den.

Parcel
Size
(acres)
Existing Use
Capacity Based on Minimum Density
Factors for Selection
Owner/
Developer
Interest
Owners Very
Low Low Mod Above Mod Total
30 8 N PACIFIC
COAST HWY 4186-031-001 CC Community SPA-7 Specific Plan 25.1 33 0.14 Auto Related 2 2 0 0 4 FAR: 1.03ILR: 0.15 Year Built: 1955
Height: <1 (3 0-story, 1 1-story)
Owner submitted a letter of interest for
redevelopment.

Factors for Selection: a, d, f, g, h
Y
900 North PCH
LLC c/o Peter
Nolan
30 No Address 4186-031-002 CC Community SPA-7
Specific Plan 25.1 33 0.14 Auto Related 1 2 0 0 3
30 18 N PACIFIC
COAST HWY 4186-031-003 CC Community SPA-7 Specific Plan 25.1 33 0.25 Auto Related 3 3 0 0 6 30 26 N PACIFIC
COAST HWY 4186-031-036 CC Community
SPA-7
Specific Plan 25.1 33 0.21 Auto Related 2 3 0 0 5
31 1734 PACIFIC
COAST HWY 4185-002-007 CC Community SPA-8 Specific Plan 25.1 33 0.13 Retail 0 0 3 0 3 FAR: 0.14ILR: 0.29 Year Built: 1952
Height: 1
Only occupied by a 1-story single-family
home. Owner submitted a letter of interest
for redevelopment.

Factors for Selection: a, c, d, e, f, g, h
Y
Egerer, Joseph J
and Egerer,
31 Thomas C 1706 PACIFIC
COAST HWY 4185-002-014 CC Community
SPA-8
Specific Plan

25.1 33 0.17 Retail 0 0 4 0 4
Total 224 129 171 80 604
Notes:
*Income level assigned to lower for parcels at least 0.5 ac. and smaller parcels that can be consolidated, or moderate for other small parcels less than 0.5 ac.

Site 7 is excluded as a site to meet the RHNA as it only meet two of the five criteria for underutilization.

Hermosa Beach 2021-2029 Housing Element Appendix B – Land Inventory Housing Element Technical Report Adopted December 21, 2021 / August 8, 2023 CERTIFIED August 1, 2024 Revised January, May, June 2024 B-28
Figure B-1
Sites Inventory

Kosmont Companies
Mailing Address: 1601 N. Sepulveda Blvd., #382 (424) 297-1070 Physical Address: 2301 Rosecrans Ave, Ste. 4140 Manhattan Beach, CA 90266 www.kosmont.com El Segundo, CA 90245 October 5, 2023
Carrie Tai
Director
Community Development
City of Hermosa Beach
1315 Valley Drive
Hermosa Beach, CA 90254
Re: City of Hermosa Beach Land Value Recapture – Summary of Methodology Dear Ms. Tai,
The City of Hermosa Beach (“City”) retained Kosmont Companies (“Kosmont”) to evaluate potential provisions of the City’s proposed Land Value Recapture (“LVR”) program. The LVR program is intended to “capture” added land value on properties within certain commercial corridors on which the City is allowing residential development through rezoning actions. The LVR program is intended to incentivize the development of affordable housing within the City. To ensure that new developments result in production of affordable housing units in the City, the City proposes to levy this fee. Developments may be exempted from the fee if they include affordable housing. Fees paid would support the development of affordable housing units elsewhere in the City. The summary of methodology herein (“Summary”) highlights pertinent assumptions utilized in evaluating the potential number of affordable units to be required within a residential development in order to be exempt from the fee, as well as the potential amount of the fee that the City may desire to initially levy under the LVR program.

As summarized herein, Kosmont’s analysis (“Analysis”) generally indicates that requiring residential projects to include a set aside of 10% very low-income, 15% low-income, 20% moderate-income units, or alternatively, pay a fee of approximately $60 per net residential square foot may be justifiable for the initial implementation of the LVR program. It is expected that the City will need to regularly revisit the amount of the fee, and potentially the exemption set-aside requirements, as fundamental inputs to the Analysis highlighted in this Summary will change over time.

The figures presented in this Summary are based on an evaluation of the potential impact to value of requiring the various percentages of affordable housing in a given multifamily (rental) development versus an exclusively market rate development. The impact of requiring affordable housing as part of a for sale development is generally considered to be greater than the figures presented herein. Given current real estate market conditions, it is expected that the developer of a for sale project would likely opt to pay the fee rather than include affordable housing in such development. However, each development has unique economics.

City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 2 | Page
(424) 297-1070
www.kosmont.com
The assumptions presented in this Summary represent one of many potential development scenarios evaluated as part of the Analysis completed, though could generally be considered a baseline set of assumptions. Finally, the assumptions herein are based on a review and modeling of inputs including real estate market conditions specific to the City, current affordable housing guidelines in the State of California (“State”), Los Angeles County Development Authority (“LACDA”) guidance on monthly housing expenditures for utilities, and the potential relationship between the LVR program and State Density Bonus Law (Government Code § 65915 – 65918).

Summary of Baseline Assumptions & Methodology

1. Maximum Housing Expenditures (Multifamily / For Rent) Maximum monthly affordable housing expenditures were calculated based on Health & Safety Code § 50053 which provides that very low-, low-, and moderate-income households shall not expend more than 30% of 50%, 60%, and 110% of the area median income (“AMI”) on housing, respectively. The AMI for Los Angeles County as published by the California Department of Housing and Community Development (“HCD”) is $98,200 for 2023. The calculated amounts were adjusted for unit sizes (bedrooms) and household size (persons) based on HCD guidance. To determine the maximum amount of monthly rent as a share of total housing expenditures, allowances for utilities as published by LACDA for the 2023 all electric schedule were deducted from the calculated amounts. The household size assumptions and utility allowances follow below.

Based on these factors, the maximum monthly rent for very low-, low-, and moderate-income households was calculated to be the amounts below.

2. Market Unit Size, Distribution, & Rent
Based on a review of data from sources including CoStar, Zillow, and the Los Angeles County Office of the Assessor, assumptions on the square footage of units of different sizes (bedrooms), Studio 1 2 3
Household Size (Persons) 1 2 3 4
Household Size Adjustment 70% 80% 90% 100%
Monthly Utility Allowance $ 193 $ 227 $ 262 $ 309
Bedrooms
Studio 1 2 3
Very Low $ 666 $ 755 $ 843 $ 919
Low 838 951 1,064 1,164
Moderate 1,697 1,933 2,168 2,392
Maximum Bedrooms
Monthly Rent

City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 3 | Page
(424) 297-1070
www.kosmont.com
the ratio of unit sizes, and market rents were developed. A summary of these assumptions follows below. For reference, monthly market rents are based on rates of $4.75 / $4.50 / $4.00 / $3.75 per square foot for studio / one-bedroom / two-bedroom / three-bedroom units, respectively, and are considered moderately conservative relative to general market comparables in the City.

3. State Density Bonus Provisions
Density Bonus Law allows residential developments that include income restricted units to develop more units than may otherwise be provided under City code. The increase in total units allowed is based on the percentage and depth of affordability provided. The contemplated LVR program requirement of 10% very low-, 15% low-, or 20% moderate-income units would entitle a developer to increase the total number of units in a development by 32.5%, 27.5%, and 15.0%, respectively. Density Bonus Law applies to developments with five or more units, includes a roundup provision on calculations, and provides for other concessions by right including increases in height, and reductions in setback requirements.

As an example, assuming a 100-unit residential development, if 10 units were restricted to very low-income households, a total of 133 units could be developed; if 15 units were restricted to lowincome households, a total of 128 units could be developed; and if 20 units were restricted to moderate-income households, a total of 115 units could be developed. The calculations in this Summary assume that a development including enough affordable units to be exempt from the LVR fee would utilize the benefits of Density Bonus Law.

4. Impact on Rental Revenue
Despite the accretive provisions of Density Bonus Law, the inclusion of affordable units within a residential development was generally found to have a negative impact on overall rental revenue.

It is assumed that market and affordable units will have similar operating costs. The overall impact to blended gross rent is provided below. For reference, the figures are compared to assumed market rents illustrated above, and blended figures are weighted averages based on unit bedroom count distributions / ratios identified in Section 2 above. As an example, this calculation provides that a 115-unit residential development that included 20 units restricted to moderate income households with 15% studio / 45% one-bedroom / 35% two-bedroom / 5% three-bedroom units would realize an average reduction in gross revenue of $226 for each of the 115 units, each month.

Studio 1 2 3
Ratio 15% 45% 35% 5%
Square Feet 475 700 950 1,150
Market Rent $2,256 $3,150 $3,800 $4,313
Bedrooms

City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 4 | Page
(424) 297-1070
www.kosmont.com

5. Capitalized Value
Multifamily real estate is generally valued based on capitalization (“cap”) rates that convert net annual rental income to a present value. Cap rates represent the initial rate of return on the total cost of project investment. Cap rates in the City are generally lower than other regional markets, indicating that investors are willing to pay more for properties in the City than they would for another property with the same income stream in an inferior market with more perceived risk. In this step of the Analysis, the impact of the inclusion of affordable housing units within a given development was evaluated on a present value basis utilizing a hypothetical 4.5% cap rate. This rate is higher than recent multifamily property transactions in the City, however is thought to be reasonable on a forward-looking basis as cap rates are increasing due to increases in interest rates and required rates of return. For reference, a lower assumed cap rate would increase the value impact per square foot discussed in Section 6 below.

Note: The value / cost impacts illustrated above are based on a 133-, 128-, and 115-unit development that included 10% very low-, 15% low-, or 20% moderate-income units, respectively.

6. Value Impact Per Square Foot
The final step of this method of evaluation is to consider the impact to value on a per square foot basis. The total leasable square footage, and impact to value on a per square foot basis are illustrated below. These figures reflect the unit square footages identified in Section 2 above, and the total unit counts identified in Section 3 above (e.g., a 133-, 128, and 115-unit development).

Average Rent Studio 1 2 3 Blended
Very Low $2,137 $2,970 $3,578 $4,057 $ 3,112
Low 2,090 2,892 3,479 3,944 3,030
Moderate 2,159 2,938 3,516 3,978 3,076
Delta From Market Studio 1 2 3 Blended
Very Low $ 120 $ 180 $ 222 $ 255 $ 190
Low 166 258 321 369 272
Moderate 97 212 284 334 226
Bedrooms
Bedrooms
Studio 1 2 3 Blended
Very Low $ 4,200,000 $ 6,400,000 $ 7,900,000 $ 9,100,000 $ 6,700,000 Low 5,700,000 8,800,000 10,900,000 12,600,000 9,300,000 Moderate 3,000,000 6,500,000 8,700,000 10,200,000 6,900,000 Capitalized Bedrooms
Impact to Value

City of Hermosa Beach
Land Value Recapture Analysis – Summary of Methodology
October 5, 2023
Kosmont Companies 5 | Page
(424) 297-1070
www.kosmont.com
Based on the blended rates in the table above, and given the assumptions identified herein, levying a fee of $66 – 94 per net (leasable) square foot of residential development would conceptually be considered economically equivalent to a developer as delivering affordable housing as part of a given development.

Findings
Based on the information presented in this Summary, a LVR fee of approximately $66 – 94 per net square foot of residential development is appropriate given a requirement for the inclusion of 10% very low-, 15% low-, or 20% moderate-income units as part of a residential development on eligible commercial properties in the City. In light of current real estate market conditions, and the infancy of the LVR program, Kosmont finds a fee of approximately $60 per net square foot of residential development is justifiable as an initial rate. The City should plan on revisiting the fee based both on the market response relative to the intent of the LVR program, and as the inputs to the calculation illustrated herein change over time.

Kosmont is available to further discuss its findings as desired at your convenience.

Yours truly,
Wil Soholt
Senior Vice President
Studio 1 2 3 Blended
Very Low 63,175 93,100 126,350 152,950 103,241
Low 60,800 89,600 121,600 147,200 99,360
Moderate 54,625 80,500 109,250 132,250 89,269
Studio 1 2 3 Blended
Very Low $ 67 $ 69 $ 62 $ 59 $ 66
Low 93 98 90 86 94
Moderate 55 81 80 77 76
Gross
Leasable SF
Value
Impact / SF
Bedrooms
Bedrooms

LAND VALUE RECAPTURE ANALYSIS

HERMOSA BEACH, CA

December 2023
Prepared By:

KOSMONT COMPANIES
1601 N. Sepulveda Blvd. #382
Manhattan Beach, CA 90266
Telephone: (424) 297-1070
www.kosmont.com

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS
Table of Contents

1.0 Background & Summary................................................................................................. 3

2.0 Fee Equivalency............................................................................................................. 4

2.1 Maximum Monthly Housing Expenditures (Multifamily / For Rent)................................ 4

2.2 Market Unit Size, Distribution, & Rent .......................................................................... 5

2.3 State Density Bonus Provisions ................................................................................... 5

2.4 Impact on Rental Revenue........................................................................................... 6

2.5 Capitalized Value......................................................................................................... 7

2.6 Value Impact Per Square Foot..................................................................................... 7

2.7 For Sale Developments ............................................................................................... 8

3.0 Market Capacity ............................................................................................................. 9

3.1 Incremental Value........................................................................................................ 9

4.0 Hypothetical Development Program Pro Forma.............................................................11

5.0 Appendices ...................................................................................................................21 Appendix A: Calculation of Maximum Monthly Housing Expenditures / Rent .........................22 Appendix B: Sample Rent & Unit Size Comparables .............................................................23 Appendix C: Estimated Value Impact Per Square Foot for Different Unit Counts...................25 Appendix D: Estimated Value Impact Per Square Foot for One to Four Units........................26 Appendix E: Hypothetical Development Pro Forma ...............................................................27 Index of Tables & Figures
Table 1: Household Size, Income Adjustment, & Monthly Utility Allowance Assumptions .......... 4 Table 2: Estimated Maximum Monthly Rent for Very Low-, Low-, and Moderate-Income Households................................................................................................................................ 5 Table 3: Assumed Unit Size & Distribution, Market Rent............................................................ 5 Table 4: Average Rent (Including Income Restricted Units) ....................................................... 6 Table 5: Delta Between Market & Average Rent ........................................................................ 7 Table 6: Estimated Capitalized Impact to Value of Including Income Restricted Units................ 7 Table 7: Gross Leasable Square Feet........................................................................................ 8 Table 8: Value Impact Per Square Foot ..................................................................................... 8 Figure 1: Hypothetical Small Site Pro Forma – Market Rate Project (LVR Fee Paid) ................12 Figure 2: Hypothetical Medium Site Pro Forma – Market Rate Project (LVR Fee Paid).............13 Figure 3: Hypothetical Medium Site Pro Forma – Project w/ Very Low-Income Unit(s)..............14 Figure 4: Hypothetical Medium Site Pro Forma – Project w/ Moderate-Income Unit(s)..............15 Figure 5: Hypothetical Medium Site Pro Forma –Very Low- & Moderate-Income Unit(s)...........16 Figure 6: Hypothetical Large Site Pro Forma – Market Rate Project (LVR Fee Paid)................17 Figure 7: Hypothetical Large Site Pro Forma – Project w/ Very Low-Income Unit(s) .................18 Figure 8: Hypothetical Large Site Pro Forma – Project w/ Moderate-Income Unit(s).................19 Figure 9: Hypothetical Large Site Pro Forma – Very Low- & Moderate-Income Unit(s) .............20

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 3

1.0 Background & Summary
The City of Hermosa Beach (“City”) retained Kosmont Companies (“Kosmont”) to evaluate potential provisions of the City’s proposed Land Value Recapture (“LVR”) program. The LVR program seeks to retain portions of land value added to properties within certain commercial corridors on which the City may allow residential development through rezoning actions. The LVR program is intended to produce affordable housing within the City. Under the LVR program, developments would pay a fee to support the development of affordable housing units elsewhere in the City or alternatively, include affordable housing within the project. This document (“Analysis”) summarizes the analysis completed in evaluating potential LVR program elements and includes three primary elements: (i) an analysis of the estimated equivalency of the fee versus the economics of including affordable units in a given project, (ii) a discussion of the proposed fee amounts and ability of the market to support the same, and (iii) order of magnitude pro forma for hypothetical developments illustrating the potential economics of the LVR program.

Pursuant to guidance from the City Council and City leadership, the LVR program evaluated herein is framed around a requirement that residential projects include a set-aside of (i) 15% very low-income units, (ii) 15% low-income units, (iii) 25% moderate-income units, or alternatively (iv), pay a fee of approximately $76 per net residential square foot for project with four or fewer dwelling units, or approximately $104 for developments with five or more dwelling units.

While every development is relatively unique, pursuant to the Analysis highlighted herein, these potential fee amounts are generally thought to be sufficient to induce some projects to include affordable housing units as part of a given development. Some projects would also be expected to elect to pay the fee rather than include affordable units. Additionally, the fee appears low enough so as not to obstruct the development of residential uses in newly eligible areas of the City. Finally, it is expected that the City will need to regularly revisit the amount of the fee, and potentially the exemption set-aside requirements, as fundamental inputs and calculations highlighted in this Analysis will change over time.

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 4

2.0 Fee Equivalency
The first element of the Analysis summarized herein is the calculation of the general economic equivalency of including a prescribed percentage and depth of (very low-, low-, or moderateincome) affordable housing within a given development versus a set fee. This calculation is not an evaluation of what the market can bear, but rather an estimate of the effective cost of requiring a development to restrict units to 15% very low-, 15% low-, or 25% moderate-income households.

The assumptions presented in this section represent one of multiple potential development scenarios evaluated as part of the Analysis completed, though could generally be considered a baseline set of assumptions. The assumptions herein are based on a review and modeling of inputs including real estate market conditions specific to the City, current affordable housing guidelines in the State of California (“State”), Los Angeles County Development Authority (“LACDA”) guidance on monthly housing expenditures for utilities, and the potential relationship between the LVR program and State Density Bonus Law (“Density Bonus”, Government Code § 65915 – 65918), including recent changes under Assembly Bill 1287 (“AB 1287”).

2.1 Maximum Monthly Housing Expenditures (Multifamily / For Rent) Maximum monthly affordable housing expenditures were calculated based on Health & Safety Code § 50053 which provides that very low-, low-, and moderate-income households shall not expend more than 30% of 50%, 60%, and 110% of the area median income (“AMI”) on housing, respectively. The AMI for Los Angeles County as published by the California Department of Housing and Community Development (“HCD”) is $98,200 for 2023. The calculated amounts were adjusted for unit sizes (bedrooms) and household size (persons) based on HCD guidance. To determine the maximum amount of monthly rent as a share of total housing expenditures, allowances for utilities as published by LACDA for the 2023 all electric schedule were deducted from the calculated amounts. It was assumed that the cost of trash service would be included in rent. The household size assumptions and utility allowances follow in Table 1 below.

Table 1: Household Size, Income Adjustment, & Monthly Utility Allowance Assumptions Source: HCD, LACDA, Kosmont (2023)
Based on these factors, the maximum monthly rent for very low-, low-, and moderate-income households were calculated as provided in Table 2 below. Additional details are provided in Appendix A: Calculation of Maximum Monthly Housing Expenditures / Rent on page 22.

Studio 1 2 3
Household Size (Persons) 1 2 3 4
Household Size Adjustment 70% 80% 90% 100%
Monthly Utility Allowance 151$ 185$ 220$ 267$
Bedrooms

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 5
Table 2: Estimated Maximum Monthly Rent for Very Low-, Low-, and Moderate-Income Households Source: HCD, HSC § 50053, LACDA, Kosmont (2023)

2.2 Market Unit Size, Distribution, & Rent
Based on a review of data from sources including CoStar, Rent.com, Zillow, and the Los Angeles County Office of the Assessor, assumptions on the square footage of units of different sizes (bedrooms), the ratio of unit sizes, and market rents were developed. A summary of these assumptions follows in Table 3 below and additional information on sample comparables is provided in Appendix B: Sample Rent & Unit Size Comparables on page 23. For reference, monthly market rents are based on rates of $4.75 / $4.50 / $4.00 / $3.75 per square foot for studio / one-bedroom / two-bedroom / three-bedroom units, respectively, and are considered moderately conservative relative to general market comparables in the City.

Table 3: Assumed Unit Size & Distribution, Market Rent
Source: CoStar, Kosmont, Rent.com, Zillow (2023)

2.3 State Density Bonus Provisions
Density Bonus law allows residential developments that include income restricted units to develop more units than may otherwise be provided under City density regulations. The increase in total units allowed is based on the percentage and depth of affordability provided. Density Bonus law applies to developments with five or more units, includes a roundup provision on calculations, and provides for other concessions by right including increases in height, and reductions in setback requirements. For reference Density Bonus provisions for moderate income units generally only apply to for sale product, however, the City proposes to permit Density Bonus provisions to apply to moderate income for rent product as well.

The following are examples of how Density Bonus provisions can be applied, assuming a residential development with 100 “base” dwelling units:
• If 15 units were restricted to very low-income households, a total of 150 units could be developed.

Studio 1 2 3
Very Low 708$ 797$ 885$ 961$
Low 880 993 1,106 1,206
Moderate 1,739 1,975 2,210 2,434
Maximum
Monthly Rent
Bedrooms
Studio 1 2 3
Ratio 15% 45% 35% 5%
Square Feet 475 700 950 1,150
Market Rent $ 2,256 $ 3,150 $ 3,800 $ 4,313
Bedrooms

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 6
• If 15 units were restricted to low-income households, a total of 128 units could be developed.
• If 25 units were restricted to moderate-income households, a total of 120 units could be developed.

The calculations in this Summary assume that a development including a sufficient number of affordable units to be exempt from the LVR fee would utilize the benefits of Density Bonus Law.

The contemplated LVR program requirement of 15% very low-, 15% low-, or 25% moderateincome units would entitle a developer to increase the total number of units in a development by 50%, 27.5%, and 20.0%, respectively.

For reference, AB 1287 was recently codified, and provides for additional increases in density should projects maximize very low-, low-, or moderate-income unit dedications and bonuses (15%, 24%, and 44% respectively). Under those circumstances additional bonuses for very lowor moderate-income units are permitted to be developed and additional bonuses are available.

Kosmont modeled the provisions of AB 1287 and found the provisions to be accretive for some of the hypothetical development programs. Ultimately the potential benefit of the new provisions may depend on the capacity to efficiently fit additional units on a given site.

2.4 Impact on Rental Revenue
Despite the accretive provisions of Density Bonus law, the inclusion of affordable units within a residential development was generally found to have a negative impact on overall rental revenue.

It is assumed that market-rate and affordable units will have similar operating costs. The overall impact to blended gross rent is provided below in Table 4. For reference, the figures are compared to assumed market rents illustrated above, and blended figures are weighted averages based on unit bedroom count distributions / ratios illustrated in Table 3 above.

Table 4: Average Rent (Including Income Restricted Units) Source: Kosmont (2023)
Calculation: ((Market Rent x Market Units) + (Affordable Rent x Affordable Units)) / Total Units As illustrated in Table 5 below, this calculation provides that a 115-unit residential development that included 25 units restricted to moderate income households with 15% studio / 45% onebedroom / 35% two-bedroom / 5% three-bedroom units would realize an average reduction in gross revenue of $262 for each of the 115 units, each month.

Average Rent Studio 1 2 3 Blended
Very Low $ 2,101 $ 2,915 $ 3,508 $ 3,977 3,054$
Low 2,095 2,897 3,484 3,948 3,035
Moderate 2,149 2,905 3,469 3,921 3,040
Bedrooms

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 7
Table 5: Delta Between Market & Average Rent
Source: Kosmont (2023)
Calculation: Market Rent – Average Rent

2.5 Capitalized Value
Multifamily real estate is generally valued based on capitalization (“cap”) rates whereby the present value of a given property is equal to the net annual rental income divided by the cap rate.

Cap rates represent the initial rate of return on the total cost of project investment. Cap rates in the City are generally lower than other regional markets, indicating that investors are willing to pay more for properties in the City than they would for another property with the same income stream in an inferior market with more perceived risk. In this step of the Analysis, the impact of the inclusion of affordable housing units within a given development was evaluated on a present value basis utilizing a hypothetical 4.5% cap rate. This rate is higher than recent multifamily property transactions in the City, however is thought to be reasonable on a forward-looking basis as cap rates are increasing due to increases in interest rates and required rates of return. For reference, a lower assumed cap rate would increase the value impact per square foot discussed in Section 2.6 below.

The total value / cost impacts based on a 150-, 128-, and 120-unit development that included 15% very low-, 15% low-, or 25% moderate-income units, respectively is provided in Table 6 below (figures have been rounded).

Table 6: Estimated Capitalized Impact to Value of Including Income Restricted Units Source: Kosmont (2023)
Calculation: Delta Between Market & Average Rent x Total Units

2.6 Value Impact Per Square Foot
The final step of this method of evaluation is to consider the impact to value on a per square foot basis. The total leasable square footage, and impact to value on a per square foot basis are illustrated in Table 7 and Table 8 below. These figures reflect the unit square footages identified Delta From Market Studio 1 2 3 Blended
Very Low $ 155 $ 235 $ 292 $ 335 $ 248
Low 161 253 316 364 267
Moderate 108 245 331 391 262
Bedrooms
Studio 1 2 3 Blended
Very Low $ 6,200,000 $ 9,400,000 $ 11,700,000 $ 13,400,000 $ 9,900,000 Low 5,500,000 8,600,000 10,800,000 12,400,000 9,100,000 Moderate 3,400,000 7,800,000 10,600,000 12,500,000 8,400,000 Capitalized
Impact to Value
Bedrooms

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 8
in Table 3 above, and the total unit counts identified in Section 2.3 above (e.g., a 150-, 128-, and 120-unit development).

Table 7: Gross Leasable Square Feet
Source: Kosmont (2023)
Calculation: Unit Square Feet x Total Units
Table 8: Value Impact Per Square Foot
Source: Kosmont (2023)
Calculation: Capitalized Impact to Value / Gross Leasable Square Feet Based on the blended rates in Table 8 above, and given the assumptions identified herein, levying a fee of $86 – 92 per net (leasable) square foot of residential development would conceptually be considered economically equivalent to a developer as delivering affordable housing as part of a given development (assuming a 100-dwelling unit project before considering density bonuses). A table and chart showing the estimated equivalency for different project sizes / dwelling unit counts can be found in Appendix C: Estimated Value Impact Per Square Foot for Different Unit Counts on page 25. Additionally, figures for developments with one to four units for which Density Bonus provisions do not apply is provided in Appendix D: Estimated Value Impact Per Square Foot for One to Four Units on page 26.

2.7 For Sale Developments
The equivalency figures presented in this Summary are based on an evaluation of the potential impact to value of requiring the various percentages of affordable housing in a given multifamily (rental) development versus an exclusively market rate development. The impact of requiring affordable housing as part of a for sale development is generally considered to be greater than the figures presented herein. Given current real estate market conditions, it is expected that the developer of a for sale project would likely opt to pay the fee rather than include affordable housing in such development. However, each development has unique economics.

Studio 1 2 3 Blended
Very Low 71,250 105,000 142,500 172,500 116,438
Low 60,800 89,600 121,600 147,200 99,360
Moderate 57,000 84,000 114,000 138,000 93,150
Gross Bedrooms
Leasable SF
Studio 1 2 3 Blended
Very Low $ 87 $ 90 $ 82 $ 78 $ 86
Low 91 96 89 84 92
Moderate 60 93 93 91 88
Value
Impact / SF
Bedrooms

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 9

3.0 Market Capacity
In this section the question of the market’s capacity to support an LVR fee is discussed. The City proposes to allow the development of residential use where such use is not currently permitted so long as such residential use either includes a component of affordable housing or an LVR fee is paid to support the development of affordable housing elsewhere.

The City is not considering requiring owners to develop residential uses on their property. Rather, the City is adding a right and value to certain areas of the City, with the condition that a portion of the incremental value conveyed be used to support affordable housing for residents of the City.

Every property and potential development is relatively unique. If adding residential use to a given property does not make economic sense, that property owner should not, and is not required to add such use. Regardless of the LVR fee ultimately levied, or amount of affordable housing required to be provided in a given development under the proposed policy, eligible properties and their owners would at worst be left at status quo. No existing property rights are proposed to be constrained or eliminated in any way. Property owners only have the potential to benefit from the LVR program, and the quantity of housing delivered within the City only has the potential to increase.

3.1 Incremental Value
As part of the Analysis, recent commercial and residential property transactions were reviewed.

In general, of the sales reviewed, most properties sold for between ~$700 - 1,500 per gross* square foot. Based on the data reviewed, values of $800 - 1,000 per gross square foot were considered indicative of typical market performance, and the higher end of this range could readily be ascribed to newer, quality product.

To evaluate the potential incremental value of the LVR program, the incremental value of newly permissible residential development (perhaps $800 to $1,000 per gross square foot, or more) can be compared to the cost of development. Construction costs can vary widely from project to project based on factors such as site prep required, construction type / materials, the quality of finishes, etc. Broadly, for the purposes of this analysis, a cost range of $400 to $600 per net square foot (excluding land) may be applicable, and this figure conceptually includes typical building permit fees, financing costs, and contractor overhead. It is possible to build many product types such as tract homes or basic additions for substantially less, and it can certainly cost substantially more to build high end or highly engineered product. *The conversion of gross to net square foot can vary substantially, but efficiency factors approaching 80% are common for larger buildings with interior corridors and indoor amenities, and higher ratios are possible for buildings with exterior corridors and without indoor amenities.

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 10
Given a potential value of $800 to $1,000 per gross square foot, and development costs of $400 to $600 per net square foot (excluding land), the net residual value or incremental value of adding residential use to a property could conceptually range from $400 to $600 per square foot of residential use, before accounting for net versus gross building area. The lower, or worst case from the assumptions above would yield $200 to $400 per square foot in new / incremental value before any potential adjustment for gross versus net square feet ($800 – $600 = $200, or $1,000 - $600 = $400).

For illustrative purposes only, should the City elect to levy an LVR fee of $100 per net square foot, the remaining incremental / residual value would be $100 to $300 per square foot of building area (given a building with a 100% gross to net efficiency). Assuming the owner of a small property was considering adding a single, 950 square foot two-bedroom unit above an existing commercial use, if the unit could be developed within a budget of $600 per square foot ($570,000), and the unit were valued at $900 per square foot ($855,000), the property owner would yield a net benefit of $190,000, after considering the LVR fee of $100 per square foot. This residual / new incremental value of $190,000 would be purely attributable to the City allowing residential uses in areas where such uses are not currently allowed. Thus, in this perhaps moderately conservative example, the City would retain $95,000 or 1/3rd of the value being conveyed (for the duration of the affordability covenants), and $190,000 or 2/3rds of the balance of the value being conveyed would be retained by the property owner (100% after the expiration of the affordability covenants).

Alternatively, a property owner could elect not to develop residential uses on their property and pursue the continuation of existing uses or other uses as currently permitted by right, without realizing any diminution in value.

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 11

4.0 Hypothetical Development Program
Pro Forma
In this section a series of high-level proforma are provided illustrating hypothetical development programs on a sample “small”, “medium”, and “large” site. For each hypothetical site, first a base case with all market rate units (wherein the LVR fee is paid) is evaluated, and subsequently hypothetical programs that include affordable housing are provided. Additionally, three hypothetical affordable housing pro forma were prepared for the medium and large site, and they evaluate the performance of a project with (i) very low-income units, (ii) moderate-income units, or (iii) a combination of very low- and moderate-income units as permitted under AB 1287.

The sites and programs presented are theoretical in nature, and prepared without the benefit of massing studies or order of magnitude construction cost estimates. They are intended to be for general demonstration purposes only. At the bottom of each pro forma, a “Return on Cost” figure is provided, and is one of many measures of potential profitability for a given project. In general, for projects of the scale evaluated herein, a Return on Cost of 8 – 12% or more would suggest a hypothetical development program may be financially feasible to a typical developer. Finally, the same pro forma for the medium and large sites are presented side-by-side in Appendix E:

Hypothetical Development Pro Forma on page 27 for easier comparison.

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 12
Figure 1: Hypothetical Small Site Pro Forma – Market Rate Project (LVR Fee Paid) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 3,250 SF
Existing Improvements 1,750 SF $ 900 /SF $ 1,575,000
Existing Parking 8 Stalls (Tandem)
Existing Value $ 1,575,000
Proposed Program
Description
Commercial 1,750 SF
Residential 1,650 SF
Parking 8 Stalls (Tandem)
Base Residential Units 2 DU
Affordable Units - DU
Density Bonus Units - DU
Total Units 2 DU (Two Bedroom Units)
Development Value
Commercial 1,750 SF $ 1,000 /SF $ 1,750,000
Market Rate Residential 1,650 SF 950 /SF 1,567,500
Affordable Residential - SF - /SF -
Total $ 3,317,500
Development Costs
Site Acquisition 1,750 SF $ 900 /SF $ 1,575,000
Commercial 1,750 SF 150 /SF 262,500
Residential 1,650 SF 600 /SF 990,000
Parking - SF - /SF -
LVR Fee 1,650 SF 76 /SF 125,400
Total $ 2,952,900
Net Margin 12.3% Return on Cost $ 364,600
Keep existing first floor commercial, add one
story of residential, no affordable units
Existing commercial / store front retail or office
use
Market Rate Project (LVR Fee Paid)

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 13
Figure 2: Hypothetical Medium Site Pro Forma – Market Rate Project (LVR Fee Paid) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF $ 800 /SF $ 4,000,000
Existing Parking 15 Stalls
Existing Value $ 4,000,000
Proposed Program
Description
Commercial 5,000 SF
Residential 5,000 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units - DU
Density Bonus Units - DU
Total Units 6 DU (One & Two Bedroom Units)
Development Value
Commercial 5,000 SF $ 900 /SF $ 4,500,000
Market Rate Residential 5,000 SF 950 /SF 4,750,000
Affordable Residential - SF - /SF -
Total $ 9,250,000
Development Costs
Site Acquisition 5,000 SF $ 800 /SF $ 4,000,000
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 5,000 SF 500 /SF 2,500,000
Parking - SF - /SF -
LVR Fee 5,000 SF 104 /SF 520,000
Total $ 9,020,000
Net Margin 2.5% Return on Cost $ 230,000
Existing commercial / store front retail or office
use
Replace first floor commercial, add one story of
residential, no affordable units
Market Rate Project (LVR Fee Paid)

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 14
Figure 3: Hypothetical Medium Site Pro Forma – Project w/ Very Low-Income Unit(s) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF $ 800 /SF $ 4,000,000
Existing Parking 15 Stalls
Existing Value $ 4,000,000
Proposed Program
Description
Commercial 5,000 SF
Residential 8,100 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units 1 DU 17% Affordable
Density Bonus Units 3 DU
Total Units 9 DU (Two Bedroom Units)
Development Value
Commercial 5,000 SF $ 900 /SF $ 4,500,000
Market Rate Residential 7,200 SF 925 /SF 6,660,000
Affordable Residential 900 SF - /SF -
Total $ 11,160,000
Development Costs
Site Acquisition 5,000 SF $ 800 /SF $ 4,000,000
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 8,100 SF 500 /SF 4,050,000
Parking 3,500 SF 125 /SF 437,500
LVR Fee 8,100 SF - /SF -
Total $ 10,487,500
Net Margin 6.4% Return on Cost $ 672,500
Project w/ Very Low-Income Unit(s)
Existing commercial / store front retail or office
use
Replace first floor commercial, add one or two
stories of residential, one very low unit

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 15
Figure 4: Hypothetical Medium Site Pro Forma – Project w/ Moderate-Income Unit(s) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF $ 800 /SF $ 4,000,000
Existing Parking 15 Stalls
Existing Value $ 4,000,000
Proposed Program
Description
Commercial 5,000 SF
Residential 7,600 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units 2 DU 33% Affordable
Density Bonus Units 2 DU
Total Units 8 DU (Two Bedroom Units)
Development Value
Commercial 5,000 SF $ 900 /SF $ 4,500,000
Market Rate Residential 5,700 SF 925 /SF 5,272,500
Affordable Residential 1,900 SF 425 /SF 807,500
Total $ 10,580,000
Development Costs
Site Acquisition 5,000 SF $ 800 /SF $ 4,000,000
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 7,600 SF 500 /SF 3,800,000
Parking 3,500 SF 125 /SF 437,500
LVR Fee 7,600 SF - /SF -
Total $ 10,237,500
Net Margin 3.3% Return on Cost $ 342,500
Project w/ Moderate-Income Unit(s)
Existing commercial / store front retail or office
use
Replace first floor commercial, add one or two
stories of residential, two moderate units

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 16
Figure 5: Hypothetical Medium Site Pro Forma – Project w/ Very Low- & Moderate-Income Unit(s) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 8,500 SF
Existing Improvements 5,000 SF $ 800 /SF $ 4,000,000
Existing Parking 15 Stalls
Existing Value $ 4,000,000
Proposed Program
Description
Commercial 5,000 SF
Residential 9,900 SF
Parking 15 Stalls
Base Residential Units 6 DU
Affordable Units 2 DU 33%
Density Bonus Units 6 DU
Total Units 12 DU (One & Two Bedroom Units)
Development Value
Commercial 5,000 SF $ 875 /SF $ 4,375,000
Market Rate Residential 8,250 SF 950 /SF 7,837,500
Affordable Residential 1,650 SF 225 /SF 371,250
Total $ 12,583,750
Development Costs
Site Acquisition 5,000 SF $ 800 /SF $ 4,000,000
Site Clearance - SF - /SF -
Commercial 5,000 SF 400 /SF 2,000,000
Residential 9,900 SF 525 /SF 5,197,500
Parking 3,500 SF 125 /SF 437,500
LVR Fee 9,900 SF - /SF -
Total $ 11,635,000
Net Margin 8.2% Return on Cost $ 948,750
Project w/ Very Low- & Moderate-Income
Existing commercial / store front retail or office
use
Replace first floor commercial, add two stories
of residential, one very low, one moderate unit

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 17
Figure 6: Hypothetical Large Site Pro Forma – Market Rate Project (LVR Fee Paid) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF $ 250 /SF $ 3,750,000
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value $ 3,750,000
Proposed Program
Description
Commercial 3,500 SF
Residential 11,400 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units - DU
Density Bonus Units - DU
Total Units 12 DU (Two Bedroom Units)
Development Value
Commercial 3,500 SF $ 900 /SF $ 3,150,000
Market Rate Residential 11,400 SF 925 /SF 10,545,000
Affordable Residential - SF - /SF -
Total $ 13,695,000
Development Costs
Site Acquisition 15,000 SF $ 250 /SF $ 3,750,000
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 11,400 SF 450 /SF 5,130,000
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 11,400 SF 104 /SF 1,185,600
Total $ 12,865,600
Net Margin 6.4% Return on Cost $ 829,400
Replace first floor commercial, add two stories
of residential, no affordable units
Market Rate Project (LVR Fee Paid)
Existing commercial / store front retail or office
use

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 18
Figure 7: Hypothetical Large Site Pro Forma – Project w/ Very Low-Income Unit(s) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF $ 250 /SF $ 3,750,000
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value $ 3,750,000
Proposed Program
Description
Commercial 3,500 SF
Residential 17,100 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units 2 DU 17% Affordable
Density Bonus Units 6 DU
Total Units 18 DU (Two Bedroom Units)
Development Value
Commercial 3,500 SF $ 900 /SF $ 3,150,000
Market Rate Residential 15,200 SF 925 /SF 14,060,000
Affordable Residential 1,900 SF - /SF -
Total $ 17,210,000
Development Costs
Site Acquisition 15,000 SF $ 250 /SF $ 3,750,000
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 17,100 SF 450 /SF 7,695,000
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 17,100 SF - /SF -
Total $ 14,245,000
Net Margin 20.8% Return on Cost $ 2,965,000
Replace first floor commercial, add two or three
stories of residential, two very low units
Project w/ Very Low-Income Unit(s)
Existing commercial / store front retail or office
use

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 19
Figure 8: Hypothetical Large Site Pro Forma – Project w/ Moderate-Income Unit(s) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF $ 250 /SF $ 3,750,000
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value $ 3,750,000
Proposed Program
Description
Commercial 3,500 SF
Residential 14,250 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units 3 DU 25% Affordable
Density Bonus Units 3 DU
Total Units 15 DU (Two Bedroom Units)
Development Value
Commercial 3,500 SF $ 900 /SF $ 3,150,000
Market Rate Residential 11,400 SF 925 /SF 10,545,000
Affordable Residential 2,850 SF 425 /SF 1,211,250
Total $ 14,906,250
Development Costs
Site Acquisition 15,000 SF $ 250 /SF $ 3,750,000
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 14,250 SF 450 /SF 6,412,500
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 14,250 SF - /SF -
Total $ 12,962,500
Net Margin 15.0% Return on Cost $ 1,943,750
Replace first floor commercial, add two stories
of residential, three moderate units
Project w/ Moderate-Income Unit(s)
Existing commercial / store front retail or office
use

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 20
Figure 9: Hypothetical Large Site Pro Forma – Project w/ Very Low- & Moderate-Income Unit(s) Source: Kosmont (2023)
Property Profile
Description of Improvements
Lot Area 15,000 SF $ 250 /SF $ 3,750,000
Existing Improvements 5,000 SF
Existing Parking - Stalls
Existing Value $ 3,750,000
Proposed Program
Description
Commercial 3,500 SF
Residential 19,800 SF
Parking 30 Stalls
Base Residential Units 12 DU
Affordable Units 4 DU 33% Affordable
Density Bonus Units 12 DU
Total Units 24 DU (One & Two Bedroom Units)
Development Value
Commercial 3,500 SF $ 875 /SF $ 3,062,500
Market Rate Residential 16,500 SF 950 /SF 15,675,000
Affordable Residential 3,300 SF 225 /SF 742,500
Total $ 19,480,000
Development Costs
Site Acquisition 15,000 SF $ 250 /SF $ 3,750,000
Site Clearance 5,000 SF 50 /SF 250,000
Commercial 3,500 SF 400 /SF 1,400,000
Residential 19,800 SF 450 /SF 8,910,000
Parking 11,500 SF 100 /SF 1,150,000
LVR Fee 19,800 SF - /SF -
Total $ 15,460,000
Net Margin 26.0% Return on Cost $ 4,020,000
Project w/ Very Low- & Moderate-Income
Existing commercial / store front retail or office
use
Replace first floor commercial, add three stories of
residential, two very low, two moderate units

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 21

5.0 Appendices

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 22
Appendix A: Calculation of Maximum Monthly Housing Expenditures / Rent 2023 Area Median Income $ 98,200
Income Thresholds
Very Low
Low
Moderate
Bedrooms Studio 1 2 3
Household Size 1 2 3 4
Household Size Adj. 70% 80% 90% 100%
Utility Allowance - 2023 Multifamily All Electric
Heating $ 14 $ 20 $ 25 $ 32
Cooking 7 10 13 16
Water Heating 14 19 25 31
Basic Electric 27 33 40 48
Water 73 82 91 109
Trash 42 42 42 42
Air Conditioning 10 15 20 25
Refrigerator 6 6 6 6
Total $ 193 $ 227 $ 262 $ 309
Allowed Monthly Housing Expenditures (Multifamily / For Rent) Bedrooms Studio 1 2 3
Very Low $ 666 $ 755 $ 843 $ 919
Low 838 951 1,064 1,164
Moderate 1,697 1,933 2,168 2,392
Percent of AMI
50%
60%
110%
Max Household Exp %
30%
30%
30%

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 23
Appendix B: Sample Rent & Unit Size Comparables
CoStar Properties (~July 2023)
Zillow & Rent.com Properties (~July 2023)
Address Bed Bath SF Rent $/SF Source
415 Herondo St - 1 360 $ 2,337 $ 6.49 Zillow
415 Herondo St - 1 408 2,331 5.71 Zillow
720 Monterey Blvd - 1 450 2,250 5.00 Zillow
415 Herondo St - 1 512 2,523 4.93 Zillow
415 Herondo St - 1 562 2,563 4.56 Zillow
Average 458 $ 2,401 $ 5.34
Median 450 2,337 5.00
Address Bed Bath SF Rent $/SF Source
1140 Hermosa Ave 1 1 400 $ 2,350 $ 5.88 Zillow
1346 Bayview Dr 1 1 400 2,500 6.25 Zillow
1821 Pacific Coast Hwy 1 1 550 2,495 4.54 Rent.com
707 Manhattan Ave 1 1 408 2,830 6.94 Zillow
2001 Pacific Coast Hwy 1 1 500 2,295 4.59 Zillow
2001 Pacific Coast Hwy 1 1 500 2,395 4.79 Zillow
2001 Pacific Coast Hwy 1 1 500 2,495 4.99 Zillow
2026 Hermosa Ave 1 1 500 2,850 5.70 Zillow
718 21st St 1 1 550 2,500 4.55 Zillow
454 Longfellow Ave 1 1 590 2,800 4.75 Zillow
2100 Hermosa Ave 1 1 600 3,550 5.92 Zillow
216 Hermosa Ave 1 1 630 3,200 5.08 Zillow
415 Herondo St 1 1 644 3,004 4.66 Zillow
137 27th St 1 1 650 3,500 5.38 Zillow
225 30th PL 1 1 750 3,300 4.40 Zillow
415 Herondo St 2 1 758 3,585 4.73 Zillow
415 Herondo St 2 1 855 3,047 3.56 Zillow
3101 Manhattan Ave 1 1 858 3,100 3.61 Zillow
Average 591 $ 2,878 $ 5.02
Median 570 2,840 4.77
One Bedroom Units
Studio Units

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 24
Address Bed Bath SF Rent $/SF Source
721 Manhattan Ave 1 2 560 $ 3,200 $ 5.71 Zillow
1154 Cypress Ave 1 2 690 3,600 5.22 Zillow
2011 Manhattan Ave 1 2 700 2,595 3.71 Zillow
2100 Hermosa Ave 1 2 700 3,800 5.43 Zillow
415 Herondo St 1 2 717 3,450 4.81 Zillow
950 1st St 1 2 759 2,875 3.79 Zillow
1821 Pacific Coast Hwy 2 2 900 3,125 3.47 Rent.com
404 Hermosa Ave 1 2 779 4,495 5.77 Zillow
2411 Prospect 2 2 855 3,395 3.97 Zillow
10 Meyer Ct 1 2 900 3,200 3.56 Zillow
1707 E Pacific Coast Hwy 2 2 974 3,598 3.69 Zillow
75 18th St 2 2 832 4,300 5.17 Rent.com
77 15th St 2 2 981 4,500 4.59 Zillow
1836 The Strand 2 2 1,000 5,995 6.00 Zillow
1652 Monterey Blvd 2 2 1,050 4,800 4.57 Zillow
1656 Monterey Blvd 2 2 1,050 4,800 4.57 Zillow
101 Monterey Blvd 2 2 1,074 3,300 3.07 Zillow
676 5th St 2 2 1,100 3,850 3.50 Zillow
1442 Bayview Dr 2 2 1,200 4,500 3.75 Zillow
1636 Palm Drive 2 2 1,200 5,995 5.00 Zillow
20 22nd St 2 2 1,276 6,000 4.70 Zillow
47 8th St 3 2 1,288 6,000 4.66 Zillow
408 Ocean View Ave 3 2 1,296 6,500 5.02 Zillow
743 24th PL 2 2 1,500 4,900 3.27 Zillow
Average 974 $ 4,282 $ 4.46
Median 978 4,075 4.58
Address Bed Bath SF Rent $/SF Source
639 1st St 3 3 1,200 $ 4,800 $ 4.00 Zillow
428 The Strand 2 3 1,846 9,500 5.15 Zillow
Average 1,523 $ 7,150 $ 4.57
Median 1,523 7,150 4.57
Two Bedroom Units
Three Bedroom Units

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 25
Appendix C: Estimated Value Impact Per Square Foot for Different Unit Counts *Dwelling unit counts are prior to use of density bonus provisions Units* Very Low Low Moderate
5 $ 107 $ 112 $ 121
6 95 98 106
7 156 143 94
8 143 131 85
9 123 121 106
10 115 112 98
11 101 105 91
12 95 98 85
13 86 93 99
14 123 118 94
15 112 112 89
16 107 107 85
17 99 103 96
18 95 98 92
19 89 94 92
20 86 91 88
30 95 98 91
40 86 93 88
50 92 97 90
60 86 92 88
70 90 95 90
80 86 93 88
90 89 94 89
100 86 92 88

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 26
Appendix D: Estimated Value Impact Per Square Foot for One to Four Units Studio 1 2 3 Blended
Very Low $ 869 $ 896 $ 818 $ 777 $ 859
Low 773 822 756 720 786
Moderate 290 447 446 436 423
Very Low $ 435 $ 448 $ 409 $ 389 $ 430
Low 386 411 378 360 393
Moderate 145 224 223 218 211
Very Low $ 290 $ 299 $ 273 $ 259 $ 286
Low 258 274 252 240 262
Moderate 97 149 149 145 141
Very Low $ 217 $ 224 $ 205 $ 194 $ 215
Low 193 205 189 180 197
Moderate 73 112 112 109 106
One Unit w/ One Affordable Unit (100% Affordable)
Two Units w/ One Affordable Unit (50% Affordable)
Three Units w/ One Affordable Unit (33% Affordable)
Four Units w/ One Affordable Unit (25% Affordable)
Value
Impact / SF
Bedrooms

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 27
Appendix E: Hypothetical Development Pro Forma

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 28
Hypothetical Medium Site Pro Forma
Property Profile
Description of Improvements
Lot Area 8,500 SF 8,500 SF 8,500 SF 8,500 SF
Existing Improvements 5,000 SF 800 $ /SF 4,000,000 $ 5,000 SF 800 $ /SF 4,000,000 $ 5,000 SF 800 $ /SF 4,000,000 $ 5,000 SF 800 $ /SF 4,000,000 $ Existing Parking 15 Stalls 15 Stalls 15 Stalls 15 Stalls Existing Value 4,000,000 $ 4,000,000 $ 4,000,000 $ 4,000,000 $ Proposed Program
Description
Commercial 5,000 SF 5,000 SF 5,000 SF 5,000 SF
Residential 5,000 SF 8,100 SF 7,600 SF 9,900 SF
Parking 15 Stalls 15 Stalls 15 Stalls 15 Stalls
Base Residential Units 6 DU 6 DU 6 DU 6 DU
Affordable Units - DU 1 DU 17% Affordable 2 DU 33% Affordable 2 DU 33% Density Bonus Units - DU 3 DU 2 DU 6 DU
Total Units 6 DU (One & Two Bedroom Units) 9 DU (Two Bedroom Units) 8 DU (Two Bedroom Units) 12 DU (One & Two Bedroom Units) Development Value
Commercial 5,000 SF 900 $ /SF 4,500,000 $ 5,000 SF 900 $ /SF 4,500,000 $ 5,000 SF 900 $ /SF 4,500,000 $ 5,000 SF 875 $ /SF 4,375,000 $ Market Rate Residential 5,000 SF 950 /SF 4,750,000 7,200 SF 925 /SF 6,660,000 5,700 SF 925 /SF 5,272,500 8,250 SF 950 /SF 7,837,500 Affordable Residential - SF - /SF - 900 SF - /SF - 1,900 SF 425 /SF 807,500 1,650 SF 225 /SF 371,250 Total 9,250,000 $ 11,160,000 $ 10,580,000 $ 12,583,750 $ Development Costs
Site Acquisition 5,000 SF 800 $ /SF 4,000,000 $ 5,000 SF 800 $ /SF 4,000,000 $ 5,000 SF 800 $ /SF 4,000,000 $ 5,000 SF 800 $ /SF 4,000,000 $ Site Clearance - SF - /SF - - SF - /SF - - SF - /SF - - SF - /SF - Commercial 5,000 SF 400 /SF 2,000,000 5,000 SF 400 /SF 2,000,000 5,000 SF 400 /SF 2,000,000 5,000 SF 400 /SF 2,000,000 Residential 5,000 SF 500 /SF 2,500,000 8,100 SF 500 /SF 4,050,000 7,600 SF 500 /SF 3,800,000 9,900 SF 525 /SF 5,197,500 Parking - SF - /SF - 3,500 SF 125 /SF 437,500 3,500 SF 125 /SF 437,500 3,500 SF 125 /SF 437,500 LVR Fee 5,000 SF 104 /SF 520,000 8,100 SF - /SF - 7,600 SF - /SF - 9,900 SF - /SF - Total 9,020,000 $ 10,487,500 $ 10,237,500 $ 11,635,000 $ Net Margin 2.5% Return on Cost 230,000 $ 6.4% Return on Cost 672,500 $ 3.3% Return on Cost 342,500 $ 8.2% Return on Cost 948,750 $ Project w/ Very Low- & Moderate-Income
Existing commercial / store front retail or office
use
Replace first floor commercial, add two stories
of residential, one very low, one moderate unit
Project w/ Moderate-Income Unit(s)
Existing commercial / store front retail or office
use
Replace first floor commercial, add one or two
stories of residential, two moderate units
Existing commercial / store front retail or office
use
Replace first floor commercial, add one story of
residential, no affordable units
Market Rate Project (LVR Fee Paid) Project w/ Very Low-Income Unit(s) Existing commercial / store front retail or office
use
Replace first floor commercial, add one or two
stories of residential, one very low unit

HERMOSA BEACH LAND VALUE RECAPTURE ANALYSIS 29
Hypothetical Large Site Pro Forma
Property Profile
Description of Improvements
Lot Area 15,000 SF 250 $ /SF 3,750,000 $ 15,000 SF 250 $ /SF 3,750,000 $ 15,000 SF 250 $ /SF 3,750,000 $ 15,000 SF 250 $ /SF 3,750,000 $ Existing Improvements 5,000 SF 5,000 SF 5,000 SF 5,000 SF Existing Parking - Stalls - Stalls - Stalls - Stalls
Existing Value 3,750,000 $ 3,750,000 $ 3,750,000 $ 3,750,000 $ Proposed Program
Description
Commercial 3,500 SF 3,500 SF 3,500 SF 3,500 SF
Residential 11,400 SF 17,100 SF 14,250 SF 19,800 SF
Parking 30 Stalls 30 Stalls 30 Stalls 30 Stalls
Base Residential Units 12 DU 12 DU 12 DU 12 DU
Affordable Units - DU 2 DU 17% Affordable 3 DU 25% Affordable 4 DU 33% Affordable Density Bonus Units - DU 6 DU 3 DU 12 DU
Total Units 12 DU (Two Bedroom Units) 18 DU (Two Bedroom Units) 15 DU (Two Bedroom Units) 24 DU (One & Two Bedroom Units) Development Value
Commercial 3,500 SF 900 $ /SF 3,150,000 $ 3,500 SF 900 $ /SF 3,150,000 $ 3,500 SF 900 $ /SF 3,150,000 $ 3,500 SF 875 $ /SF 3,062,500 $ Market Rate Residential 11,400 SF 925 /SF 10,545,000 15,200 SF 925 /SF 14,060,000 11,400 SF 925 /SF 10,545,000 16,500 SF 950 /SF 15,675,000 Affordable Residential - SF - /SF - 1,900 SF - /SF - 2,850 SF 425 /SF 1,211,250 3,300 SF 225 /SF 742,500 Total 13,695,000 $ 17,210,000 $ 14,906,250 $ 19,480,000 $ Development Costs
Site Acquisition 15,000 SF 250 $ /SF 3,750,000 $ 15,000 SF 250 $ /SF 3,750,000 $ 15,000 SF 250 $ /SF 3,750,000 $ 15,000 SF 250 $ /SF 3,750,000 $ Site Clearance 5,000 SF 50 /SF 250,000 5,000 SF 50 /SF 250,000 5,000 SF 50 /SF 250,000 5,000 SF 50 /SF 250,000 Commercial 3,500 SF 400 /SF 1,400,000 3,500 SF 400 /SF 1,400,000 3,500 SF 400 /SF 1,400,000 3,500 SF 400 /SF 1,400,000 Residential 11,400 SF 450 /SF 5,130,000 17,100 SF 450 /SF 7,695,000 14,250 SF 450 /SF 6,412,500 19,800 SF 450 /SF 8,910,000 Parking 11,500 SF 100 /SF 1,150,000 11,500 SF 100 /SF 1,150,000 11,500 SF 100 /SF 1,150,000 11,500 SF 100 /SF 1,150,000 LVR Fee 11,400 SF 104 /SF 1,185,600 17,100 SF - /SF - 14,250 SF - /SF - 19,800 SF - /SF - Total 12,865,600 $ 14,245,000 $ 12,962,500 $ 15,460,000 $ Net Margin 6.4% Return on Cost 829,400 $ 20.8% Return on Cost 2,965,000 $ 15.0% Return on Cost 1,943,750 $ 26.0% Return on Cost 4,020,000 $ Project w/ Very Low- & Moderate-Income
Existing commercial / store front retail or office
use
Replace first floor commercial, add three stories of
residential, two very low, two moderate units
Replace first floor commercial, add two stories
of residential, no affordable units
Replace first floor commercial, add two or three
stories of residential, two very low units
Replace first floor commercial, add two stories
of residential, three moderate units
Project w/ Very Low-Income Unit(s)
Existing commercial / store front retail or office
use
Project w/ Moderate-Income Unit(s)
Existing commercial / store front retail or office
use
Market Rate Project (LVR Fee Paid)
Existing commercial / store front retail or office
use

LAND VALUE RECAPTURE
FEES
City Council
January 27, 2026

What is Land Value Recapture?
• Infrastructure
Improvements
• Rezoning

GOVERNMENT ACTION LAND VALUE

INCREASE
$$  $$$$
• Community
Benefit

VALUE CAPTURE

BACKGROUND
 January 2024 - Land Value Recapture (LVR) Ordinance
adopted

 August 2024 - HCD certified Housing Element and LVR
Ordinance went into effect
– HCD established LVR program to be reevaluated every 2 years.  March 2025 - City Council directed the Planning Commission review of LVR Ordinance as it pertain to “small lots”
 October 2025 – Planning Commission Reviewed LVR Ord. and Fees

BACKGROUND

HOUSING ELEMENT
Program 7: Land Value Recapture
PROGRAM DESCRIPTION: value recapture policy
requires a portion of increase value caused by rezoning be dedicated to a public benefit, such as affordable
housing.

BACKGROUND
• HE Overlay added
residential capacity to
properties on the Housing
Element Sites Inventory

LVR ORDINANCE
Applicability: HE Overlay Zoned properties when
developing residential uses.
 Exempt if developed with non-residential uses only
 Exempt if affordable housing is developed on site
Minimum Capacity Very-Low Low - Moderate5 or more units 15% 15% 25% 4 or fewer units 1 unit

CURRENT LVR FEE
Applicability: when only market
rate residential units are
constructed or only a portion of
the affordable unit(s) required

LVR TIERS FEE
Tier 1 – Minimum
Density 4 or fewer
residential units
(“Small Lots”)
$76 per square foot
Tier 2 – Minimum
Density 5 or more
residential units
$114 per square foot
 LVR Fee equivalent cost of
developing affordable unit
 Fees collected would be
used to fund development of
affordable housing locally
– DEVELOPMENT SUBSIDIES
– FUNDING FOR CONVERSION OF

EXISTING MARKET RATE UNITS
– HOUSING TRUST

PC RECOMMENDATION
LVR Fee Amendment

LVR TIERS FEE
Tier 1 –
(“Small
Lots”)
Density 1-2
Units
No Fee
Density 3-4
Units
24 mo. reduction from
$76 to $40
Tier 2 – Minimum
Density 5 or more
residential units
$114 per square foot
(no change)
Zoning Amendments
 Direct staff to explore zoning
incentives that encourage
development on “small lots” on
the HE inventory list.

CEQA & Public Notice
 CEQA
Exempt from California Environmental Quality Act “Commons Sense Exemption” (Section 15061(b)(3) of State CEQA Guidelines)  Public Notice
- Legal ad published in Easy Reader
- Notice on website
- Posted in 3 locations

Recommendation

1. Determine the action is exempt from review under
the California Environmental Quality Act (“CEQA”);

2. Adopt a Resolution amending the fee schedule,
amending LVR fees for small lots; and

3. Direct staff to explore zoning regulations that
encourage development of residential units on
“small lots”

Contact us.

Alexis Oropeza, Planning Manager
310-318-0242
[email protected]
THANK YOU!

LAND VALUE RECAPTURE
RHNA and LVR TIER I
Affordability
RHNA
(2021-2029)
Very
Low
Low Moderate Above
Moderate
Total
RHNA
(2021-2029)
232 127 106 93 558
Tier 1 – Minimum
Density 4 or
fewer units
16 27 84 10 137
• Small lots comprise a little under a quarter of the housing inventory sites.

City of Hermosa Beach | Page 1 of 3
Meeting Date: January 27, 2026
Staff Report No. 26-CDD-012
Honorable Mayor and Members of the Hermosa Beach City Council

ECONOMIC DEVELOPMENT STRATEGY PROGRESS REPORT
(Alison Becker, Community Development Director)
Recommended Action:

Staff recommends City Council:

1. Receive and file this report; and

2. Retire the 2022 Economic Development Strategy
Background:

The Economic Development Strategy (Attachment 1) is the result of two years of collective efforts by the Economic Development Committee and the Stakeholders Advisory Working Group to identify Economic Development objectives and actions which commenced on April 28, 2020. For two years, the Economic Development Committee met monthly, and the 20-person Stakeholders Advisory Working Group met bimonthly, to explore and discuss Hermosa Beach business-related topics. An Economic and Market Study was also prepared to inform development of the Economic Development Strategy. At its July 12, 2022 meeting, City Council adopted the Economic Development Strategy.

The Economic Development Strategy includes 30 strategic actions divided into shortterm (1st year), mid-term (2–3 years) or long-term (3+ years) implementation. The actions are divided into five categories: Citywide Beautification; Downtown; Municipal Code Amendments; Business Outreach; and City Economic Development work program. The Economic Development Strategy is the work plan for implementation, beginning with the identified action priorities.

The Economic Development Strategy identified a multi-disciplinary complement of City Departments (City Manager’s Office, Community Development, Public Works, Community Resources, Police Department, and Human Resources), the Chamber of Commerce, and professional subject matter experts. Implementation work was anticipated to be completed by staff, the Hermosa Beach Chamber of Commerce, and occasionally with contracted subject matter expert assistance.

The Economic Development Strategy includes an action item to report to the City Council twice annually to monitor progress, prioritize actions, and consider new

City of Hermosa Beach | Page 2 of 3
opportunities. The following report informs City Council and the community of the activities undertaken by City staff that are aligned with the Strategy.

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

April 28, 2020 City Council selected Councilmembers Campbell and Detoy to serve on the Downtown Economic Development
Committee with Planning Commission Chairperson Peter
Hoffman and Commissioner David Pedersen.

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

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

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

July 12, 2022 City Council adopted Economic Development Strategy and First Year Implementation Priorities.

January 24, 2023 City Council received first progress report July 25, 2023 City Council received second progress report.

February 27, 2024 City Council received third progress report.

July 9, 2024 City Council received fourth progress report.

February 25, 2025 City Council received fifth progress report.

Discussion:

Staff evaluated all strategic action items of the Economic Development Strategy Report, as well as ongoing initiatives not identified in the Economic Development Strategy initially adopted in 2022. Staff identified numerous initiatives that further the City’s efforts in supporting the business community in improving the environment in which to do business.

City of Hermosa Beach | Page 3 of 3
The 6th progress report (Attachment 2) incorporates all action items from the past three and a half years and presents the entire Economic Development Strategy in a comprehensive way. This allows the community, City Council, and staff to focus on this effort in totality. The action items are presented in the following table in numerical order as identified in the Economic Development Strategy. The letter symbol (S, M, L) indicates whether the action item was to be initiated in the short-term (Year 1), mid-term (Year 2– 3), or long-term (Year 3+). The table identifies prior actions and provides current updates.

The table also identifies initiatives that do not currently have staff and funding resources.

The progress reports demonstrates that the City has successfully aligned its work program to support most of the strategic actions identified in the plan. Actions which have not progressed are constrained by budgetary and staff resources. Given that this Economic Development Strategy is reaching the limits of its useful life, staff recommends retiring this reporting cycle. Staff will continue advancing the strategic actions until they are renewed or replaced with other priorities identified through a new strategic planning participatory process.

Fiscal Impact:

There is no fiscal impact associated with the recommended action to receive and file the Economic Development Strategy progress report.

Attachments:

1. Link to Economic Development Strategy

2. 6
th Progress Report on the Economic Development Strategy Respectfully Submitted by: Alison Becker, AICP, Community Development Director Noted for Fiscal Impact: Brandon Walker, Administrative Services Director Approved: Steve Napolitano, City Manager

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Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update

1. (S)
Wayfinding Signs
(CMO/PW)
Both City "Walk Your Bike"
sticker decals (25) and the
Chamber of Commerceprovided "Shop Eat Truly
Hermosa" sticker decals
(16) on the sidewalk in the
downtown areas were
replaced in May and June
2024. CIP 111 was
reassigned to one of the
new Senior Engineers and
scheduled to resume in
June 2024 per the revised
Estimated Capital
Improvement Program
(CIP) Project Scheduled
presented to City Council at
the CIP Study Session on
April 18, 2024. The tentative
schedule shows completion
of this preliminary design
effort concluding in
November 2024. The
adopted budget for Fiscal
Year 2024–25 identifies the
next phase of the project
under the Deferred and
Unfunded Future Project list
and would need to be
Project timeline extended due to
staffing availability and contract
agreement expiration. Staff
procured a new contract
agreement in fall 2024, that was
then executed in December 2024.

Staff since completed a more
detailed existing conditions
inventory assessment and
finalized initial comments on the
draft preliminary designs that have
been sent to the design consultant
for consideration. Staff is actively
working to negotiate a task order
agreement under the new contract
to finalize the preliminary design
effort which is anticipated to take
approximately 4 to 6 months to
complete.

The adopted budget for Fiscal
Year 2024–25 identifies the next
phase of the project under the
Deferred and Unfunded Future
Project list and would need to be
considered for funding as part of a
future budget cycle; CIP 111 is a
preliminary design only and does
The City has received a donation
of $500,000 from former Mayor
Chuck Sheldon and his wife
Missy to fund the design,
installation, construction, and
maintenance of new monument
signage within the City. The
primary use of the funds will be
for a new digital monument sign
at the Community Center near
Pier Avenue and Pacific Coast
Highway; any remaining funds
may be directed toward
additional gateway monument
signs at other locations in the
City. The City previously
received a $50,000 contribution
for the electronic sign from the
Chamber of Commerce in 2014.

Staff is exploring the potential for
the funds to be reallocated to the
remaining unfunded elements in
the project including the
downtown wayfinding signage
and the gateway signage.

Staff is preparing preliminary
designs, and further evaluating

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Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update considered for funding as
part of a future budget
cycle; CIP 111 is a
preliminary design only and
does not include any
funding for implementation.
not include any funding for final
design or implementation.

permitting requirements, and
anticipates bringing an item to
City Council in early 2026.

2. (L)
Façade Improvement
Program for commercial
districts (CD)
There is currently no
funding or staffing
resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

3. (S)
Beautification Program,
including Gateway Entries
and Corridors
(CMO/CD/PW)
The street banner program
continues to be managed
by the Chamber of
Commerce and provides
timely and aesthetically
pleasing event/community
information. The planned
City gateway sign at the
Skechers project at
Longfellow Avenue and
PCH is scheduled for
installation in July 2024.

The installation of the
permanent ring lights on the
palm trees also included
lights along the roof line of
the Community Center and
are in operation year-round.

The street banner program
continues to be managed by the
Chamber of Commerce and
provides timely and aesthetically
pleasing event/community
information.

PW installed the new droughttolerant landscaping along the center median of Gould in July
2024.

The Chamber of Commerce
conducted a site walk on Upper
Pier Avenue with local businesses
and City staff in September 2024.

Greenbelt Trail improvements are
underway, and they will be
City Council formed a Downtown
Lighting and Beautification
Subcommittee at its May 13
2025 meeting. Staff has made
recommendations to the
subcommittee for consideration
and is working to schedule a
meeting to discuss further.

The City has received a
promised donation of $500K
from a former Mayor for
installation of a new monument
sign at Pier Ave and PCH with
the remaining funds to be spent
on entryway signs.

3 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update Public Works is currently in
process of adding new
drought tolerant
landscaping along the
center median of Gould
Avenue that will enhance
that gateway entrance to
the City. The Chamber of
Commerce conducted a site
walk with local businesses
and provided feedback for
Pier Avenue between
Hermosa Avenue and
Manhattan Avenue. Public
Works will schedule a
follow-up walk with the
Chamber to better
understand the requests.
completed in February 2025. The
improvements include new
landscaping, accessible paths and
ramps, and new fitness equipment.

New trash receptacles were
installed throughout the
Downtown.

4. (S)
Beautification Awards
(CMO)
No additional update on this
item.

No additional update on this item
for the current review period,
however, an award is planned
during the upcoming State of the
City.

Beautification Awards were
presented to the following
businesses at the April 10 2025
State of the City:
• David Caskey (Caskey Real
Estate) – renovated historic Pier
Ave. building.

4 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update • Shady Fahim (Abe’s Liquor) –
major store and landscaping
transformation

5. (L)
Consider Arts in Public
Places Program
There is currently no
funding or staffing
resources to initiate this
item. However, the recent
utility box beautification and
Skate Park art installation
added original art in public
spaces.

There is currently no funding or
staffing resources to initiate this
item.

The Public Works Department
continues to install art on utility
boxes. Artwork was added to six
more boxes within the right-of-way.

There is currently no funding or
staffing resources to initiate this
item. An Arts in Public Places
program would establish a
requirement on certain private
developments to provide public
art on private property.

Alternatively, developers could
pay a fee which would then be
used to create public art by the
City.

6. (L)
Placemaking Community
Forum
There is currently no
funding or staffing
resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item. However, regulations
promoting placemaking will be
included in the zoning ordinance
updates in 2025.

While a forum was not
established, given funding and
staffing constraints, the City does
endeavor to activate
underutilized spaces, improve
area attractiveness for all ages
and abilities, and includes the
community in decision making.

The accessible pathway in the
Greenbelt is one recent example
of this.

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Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update

7. (L)
Placemaking Project
Design
There is currently no
funding or staffing
resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

City staff involves community
stakeholders in decision-making
when neighborhood
enhancement opportunities
arise.

8. (S)
Include Beautificationrelated projects in the City
budget and CIP to add
value and for residents and
visitors to enjoy.
(PW)
CIP 109, created to
enhance the aesthetics of
utility boxes throughout the
City is in progress and was.

Public Works staff is
actively working in
coordination with a local
artist collaborative to
advance the installation of
painted or wrapped art on
utility boxes. The first art
installation was completed
in parking Lot A in early
June. To celebrate the 25th
anniversary of the Hermosa
Skatepark, the City
completed a maintenance
and beautification project at
the facility including design
and installation of new
signage provided by local
artist collaborative. Three
new artistic signs were
CIP 109, created to enhance the
aesthetics of utility boxes
throughout the City is in progress.

Public Works staff is actively
working in coordination with a local
artist collaborative to complete
installations throughout the City of
painted or wrapped art on utility
boxes. Several of the locations are
in the downtown.

To celebrate the 25th anniversary
of the Hermosa Skatepark, the
City completed a maintenance and
beautification project at the facility
including design and installation of
new signage provided by local
artist collaborative. Three new
artistic signs were unveiled at the
June 8, 2024 celebration. In
preparation, Public Works
conducted extensive beatification
work on the park including
The FY 25-26 Budget included
$100,000 funding for various
beautification projects throughout
the City. City Council formed a
Downtown Lighting and
Beautification Subcommittee at
its May 13, 2025 meeting.

Other recent improvements
include:

CIP 109, created to enhance the
aesthetics of utility boxes
throughout the City is nearing
completion. Public Works staff is
actively working in coordination
with a local artist collaborative to
complete installations throughout
the City of painted or wrapped
art on utility boxes. Several of
the locations are in the
downtown.

6 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update unveiled at the June 8,
2024 celebration. In
preparation, Public Works
conducted extensive
beatification work on the
park including concrete
repair, signage
replacement, repainting of
retaining walls, refreshment
of pavement markings, and
weed abatement. Public
Works staff is also in
process of repairing the
fencing and the damaged
wind screens. In
cooperation with Hermosa
Beach Little League, the
playing surface at Clark
Field Home Plate was
replaced with artificial turf.

This effort required
coordination and completion
of an Amendment to the
existing Memorandum of
Understanding between
Hermosa Beach Little
League and the City, design
review, construction
oversight and inspection by
concrete repair, fence repair,
signage replacement, repainting of
retaining walls, refreshment of
pavement markings, and weed
abatement.

In cooperation with Los Angeles
County Beaches and Harbors, the
City coordinated the County’s sand
grading operations in December
2024 on the beach from near 18th
Street. This effort required
extensive coordination by Public
Works staff with the County,
adjacent residents, the Community
Resources team, and the
volleyball court users to ensure the
effort was completed.

CIP 113 will be kicking off in
2026 that will lead to the removal
of 170 single space meters and
be replaced by 11 multi-space
meters on Pier Ave and Lot D.

This will reclaim public right-ofway along Pier Ave and Lot D that would otherwise be taken up
by parking meters.

7 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update Public Works staff. In
cooperation with Los
Angeles County Beaches
and Harbors, the City
completed sand grading on
the beach from Herondo
Avenue to 14th Street. This
effort required extensive
coordination by Public
Works staff with the County,
adjacent residents and
businesses, the Community
Resources team, and the
volleyball court users to
ensure the project was
completed in advance of the
busy spring season. The
work also required
significant work by the City
to remove and replace all
impacted volleyball courts.

9. (S)
Work with Business
Community to Explore
Formation of a Downtown
Business Improvement
District (BID).
(Chamber)
The Chamber indicated that
it is still pursuing a Tourism
Improvement District.

The Chamber of Commerce
indicated it continues to work on
establishing a Tourism
Improvement District.

This project is still in progress.

The Chamber hopes to bring the
item to Council in early 2026.

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Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update

10. (M)
Focused Update of
Downtown Revitalization
Strategy, including
Preservation of Downtown
Retail and Restaurants
and Other Active Uses on
1st Floor.
(CMO/CD)
The City recently secured
the professional assistance
of Lee Andrews to conduct
a 12-month outreach phase
of the Civic Facilities
discussion. PLAN Hermosa,
the City’s General Plan,
identified the civic center as
a catalyst for downtown
revitalization strategies.

Community support and
interest in Civic Center
investment is a means of
downtown revitalization.

In reviewing the City’s
Housing Element-related
zoning changes, California
Housing and Community
Development (HCD)
identified guest parking for
multi-family residential as a
governmental constraint.

The City Council recently
approved a Zone Text
Amendment eliminating
guest parking requirement
for development of three or
more units, including in
The Chamber of Commerce
conducted a site walk on Upper
Pier Avenue with local businesses
and City staff in September 2024.

The City recently engaged Lee
Andrews to lead a 12-month
outreach phase for the Civic
Facilities discussion, which has
resulted in valuable community
input on facility priorities.

Following Advisory Group
recommendations and Council
direction, the focus has shifted to
revitalizing the City’s Public
Works Yard.

Ground floor uses will be a topic
of discussion in the upcoming
planning process in 2026
focused on commercial zones as
a part of the City’s Zoning Code
Update.

9 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update mixed use development.

Mixed-use development
was identified as an
improvement strategy for
Downtown.

In April 2024, City Council
requested a discussion on a
potentially prohibiting office
uses on the ground floor of
commercial areas. After
discussion, City Council
provided guidance that
incentives should be
included in the Zoning Text
Amendment to encourage
pedestrian-oriented uses on
the ground floor in
commercial districts.

11. (S)
Develop Identity/Vision for
the Downtown (Objective:

Incorporate City brand with
marketing and future
improvements).
(CMO/PW)
The street pole banner
program and logo licensing
agreements are ongoing.

The street pole banner program
and logo licensing agreements are
ongoing.

There was no additional activity
related to this strategic action in
2025.

12. Comprehensive Downtown
Lighting Evaluation with
Complete Photometric
The estimated project
schedule for CIP 621 was
changed as part of the FY
The estimated project schedule for
CIP 621 was changed as part of
As part of the FY 25-56 budget
process, the project schedule is

10 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update (S) Study, Design and
Installation
(PW)
24–25 budget process with
the start delayed until June
2026 due to the need to
advance other high priority
deferred maintenance,
safety, and critical
infrastructure projects in the
CIP. The schedule for the
start of this remains
contingent of the completion
of other high priority
projects and staff availability
with the project timeline to
be revisited as part of the
next budget cycle. The
current funding supports the
preliminary design phase
only and additional funding
will be necessary for final
design and installation as
part of a future CIP once
the scope of work and costs
are more clearly defined.

During the interim period,
the City replaced the string
lighting on palm trees along
Pier Avenue and Hermosa
Avenue with new ring lights,
as well as new lighting
the FY 24–25 budget process with
the start delayed until June 2026
due to the need to advance other
high priority deferred maintenance,
safety, and critical infrastructure
projects in the CIP. The schedule
for the start of this remains
contingent of the completion of
other high priority projects and
staff availability with the project
timeline to be revisited as part of
the next budget cycle for FY 25-

26. The current funding supports
the preliminary design phase only
and additional funding will be
necessary for final design and
installation as part of a future
unfunded CIP once the scope of
work and costs are more clearly
defined. During the interim period,
the City replaced the string lighting
on palm trees along Pier Avenue
and Hermosa Avenue with new
ring lights, as well as new lighting
along the roofline of the
Community Center, for enhanced
aesthetic, to provide a more
permanent installation, and ease in
not anticipated to begin before
Spring/Summer 2026 due to
other project priorities and
staffing availability. As scoped,
the CIP currently only includes
funding for conceptual design
and does not have adequate
funding for final design or
installation. City Council formed
a Downtown Lighting and
Beautification Subcommittee at
its May 13 2025 meeting to help
further flesh out the scope of
work on this project as it is not
well defined.

11 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update along the roofline of the
Community Center, for
enhanced aesthetic, to
provide a more permanent
installation, and ease in
maintenance. These more
permanent fixtures were
installed in December 2023
and will be used all year
long and can change colors.
maintenance. These more
permanent fixtures were installed
in December 2023 and will be
used all year long and can change
colors.

13. (L)
Introduce and Facilitate
Downtown Experiences
(CMO/CR)
The City continues to
support Special Events
downtown. During this
reporting period, the City’s
support of the Los Angeles
RAMs draft event was
heralded as spotlighting
Hermosa Beach and its
beach-adjacent downtown.

The City continues to support
Special Events downtown.

A zone text amendment updating
temporary minor special events
regulations for events on private
property was considered by the
Planning Commission at a study
session in December 2024 and in
a public hearing on February 18,
2025. These standards would be
implemented citywide and would
also apply in the downtown area.

Between the months of May and
September: Fiesta Hermosa, You
Are Enough 5K, Smackfest
Volleyball Tournaments,
JVA/BVCA Tournaments, AAU
Volleyball Tournaments, AVP
Junior National Championships,
International Surf Festival,
Triathlon, CBVA Volleyball
Tournaments, Hermosa Beach
Open, Hermosa Beach Concert
Series, Movies at the Beach,
Locale 90254
On June 10, 2025, the City
Council approved a
Zone Text Amendment that

12 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update updated the regulation for
temporary events. This update
provides greater flexibility for
both indoor and outdoor events
in support of businesses and the
creation of temporary
experiences.

14. (S)
Permanently Allow Outdoor
Dining Areas and Lane
Reconfigurations.
(PW/CMO)
Council approved
guidelines for the on-street
outdoor dining program in
February 2024. Staff is
currently finalizing a Coastal
Development Permit to be
submitted to the Coastal
Commission in Summer
2024.

Council approved lane
reconfigurations and guidelines for
the on-street outdoor dining
program in February 2024. Staff is
continuing to work with the
California Coastal Commission to
obtain a Coastal Development
Permit.
13 businesses are currently
permitted for on-street outdoor
dining. A CDP application for
Coastal Commission is in
progress and should be
submitted in early 2026.

15. (S)
Long-term Allowance of
Outdoor Music in Business
Locations
(CD)
The on-street outdoor
dining guidelines approved
in February 2024 allow onstreet dining areas to have
music in the encroachment
areas.

The Hermosa Beach Concert
Series returned in 2024 on the two
Sundays following Labor Day
weekend, September 8, 2024 and
September 15, 2024, attracting
5,000 attendees total over the
Zoning regulations pertaining to
entertainment on private property
would be addressed as a part of
the zoning update in the first half
of 2026.

13 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update course of the two concerts. It will
continue on the same weekends in
2025.

16. (M)
Program to Allow Outdoor
Music in Public Spaces
(CMO/CD)
There is currently no
funding or staffing
resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

This action item contemplates a
code amendment to Title 12.

17. (M)
Regular Communication
with Key Property Owners
to Encourage
Reinvestment and Provide
Support as Needed.
(CMO/CD)
City staff conduct regular
meetings with the Chamber
of Commerce
representatives, as well as
any business owner(s)
seeking support. During this
period of notable retail
space turnover, the City’s
Planning staff has assisted
prospective business
owners and representatives
to discuss potential uses.

City staff conduct regular meetings
with the Chamber of Commerce
representatives, as well as any
business owner(s) seeking
support. During this period, the
City’s Planning staff has assisted
prospective business owners and
representatives and has
processed a number of
entitlements and tenant
improvements for businesses.

City staff routinely meets with the
Chamber of Commerce and
business owners seeking
assistance.

18. (M)
Develop
Business Visitation
Program.
(CMO/Chamber/PD/CD)
Chamber of Commerce
continued with “Walk N
Talks,” a program to
connect City elected and
appointed officials with
various businesses. A
The Chamber of Commerce
continued with “Walk N Talks,” a
program to connect City elected
and appointed officials with various
businesses. A third walk was
conducted in September 2024 in
The Police Department has
continued the WTF events
throughout the city. During this
calendar year, the Police
Department has hosted the
following events:

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Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update second walk was continued
in April 2024 of Lower Pier
Avenue, resulting in
beautification
recommendations. In
addition to the Coffee with a
Cop program, the Police
Department started What
the Fuzz (WTF) meetings to
create meaningful
engagements with the
community and businesses.

WTF is not limited to
businesses and could be
done in any neighborhood
or private residence. When
scheduling WTF meetings,
the Police Department
requests the host suggest
the best day and time and
possible topics. The City
has conducted multiple
successful WTF meetings
and plans to hold them
monthly. Businesses are
scheduled through all of
2024 and into 2025 and the
department continues to
receive requests from
the Upper Pier area. A fourth walk
is anticipated in areas of outside of
downtown in Spring of 2025.

In addition to the Coffee with a
Cop program, the Police
Department started What the Fuzz
(WTF) meetings to create
meaningful engagements with the
community and businesses. WTF
is not limited to businesses and
could be done in any
neighborhood or private residence.

When scheduling WTF meetings,
the Police Department requests
the host suggest the best day and
time and possible topics. The City
has conducted multiple successful
WTF meetings and plans to hold
them monthly. Businesses are
scheduled through 2025 and the
department continues to receive
requests from businesses and
other groups.

The Police Department regularly
participates in the monthly
Chamber of Commerce to provide
updates on events and crime
trends affecting businesses.
1/15/25 - Coffee with a Cop at
Starbucks (1107 PCH)
2/5/25 - What the Fuzz at Bolt
3/13/25 - What the Fuzz at
Starbucks (1303 Hermosa Ave)
4/29/25 - What the Fuzz at
Gitana (5k run/walk)
5/29/25 - What the Fuzz at
Paisanos (Pizza w/the Police)
6/30/25 - What the Fuzz w/
Beach Cities Health District
(Yoga on the Beach)
7/22/25 - What the Fuzz at
Mickey's Deli (Hoagie w/a Hero)
8/21/25 - What the Fuzz at
Baked Bear (Cookie w/a Cop)
10/1/25 - Coffee w/a Cop at Java
Man
11/5/25 - What the Fuzz at
Pavilions (Shop w/a Cop)
12/12/25 - Santa Sleigh
Ride/Movie Night
The Police Department
continues to participate in the
monthly Chamber of Commerce
to provide updates on events

15 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update businesses and other
groups. City Council and
City staff are invited to, and
attend, ribbon cuttings and
other events organized by
the Hermosa Beach
Chamber of Commerce. In
April 2024, the City of
Hermosa Beach co-hosted
a Lunch and Learn for
Hermosa Beach businesses
to obtain information about
how to prepare their
business and employee for
natural disasters.

City Council and City staff
participate in ribbon cuttings and
other events organized by the
Hermosa Beach Chamber of
Commerce.
and crime trends affecting
businesses.

In September 2025, The City cohosted a BE READY: Emergency Preparedness for Businesses
lunch meeting with the Chamber
of Commerce to help businesses
prepare for natural disasters.

19. (M)
Annual Commercial
Property Owner and
Brokers Forum
(CMO / Chamber)
City staff-initiated
discussions with the
Chamber of Commerce on
this item.

City staff-initiated discussions with
the Chamber of Commerce on
this item.

Downtown business forum/tours
have been hosted by the
Chamber when interest
warranted.

20. (S)
Shop Local Program
(CMO / Chamber)
The collaboration between
the City and Chamber of
Commerce on the Shop
Local Program continues. A
Summer 2024 shop local
social media campaign
The City continues to promote the
Shop Local Program. Free
parking was provided during the
holiday shopping season.

City staff brought forward the
complimentary holiday parking
program review to City Council in
October 2025. Council elected to
continue the program for the
2025 holiday season from
December 3rd – December 25th.

16 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update aimed at the City’s 23,000
followers is forthcoming.

21. (S)
Provide Hermosa Beach
Business Information to
Event Promoters to
Encourage Use of Local
Vendors and Distribution to
Participants.
(CR / Chamber)

Completed. Completed. Staff provides Hermosa Beach
business information to event
producer(s) to encourage use of
local restaurants and businesses
from participants & crew.

Included is a link to the
Chamber’s business directory to
share or utilize for lunch or
catering needs Shop - Truly
Hermosa

22. (M)
Retail Attraction
Program for
Competitive, Strengthened
Retail
(CMO / Chamber / CD)
There is currently no
funding or staffing
resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

The Chamber of Commerce
established a subcommittee
focused on Retail Businesses.

The Chamber has created a
Retail Committee and meets
monthly.

23. (S)

Partnership with Chamber
of Commerce to Enhance
Visitors Bureau to Develop
And Promote the Hermosa
Beach Brand and Provide
Visitor Resources
(CMO/Chamber)
The agreement with the
Hermosa Beach Chamber
of Commerce to allow for
the sale of souvenirs and
decorative items bearing
the City logo to promote the
Hermosa Beach brand and
to generate revenue to
The agreement with the Hermosa
Beach Chamber of Commerce to
allow for the sale of souvenirs and
decorative items bearing the City
logo to promote the Hermosa
Beach brand and to generate
revenue to support tourism
activities remains in place.

Truly Hermosa magazine is
distributed to a variety of
business locations and a Truly
Hermosa Instagram page was
created.

17 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update support tourism activities
remains in place.

24. (M)
Periodic Community
Survey to Determine What
Types of Shops or Goods
Are Desired and Residents
to Drive out of Town to
Patronize (CMO /
Chamber)
There is currently no
funding or staffing
resources to initiate this
item.

There is currently no funding or
staffing resources to initiate this
item.

The Chamber has created a
Retail Committee and meets
monthly.

25. (M)
Explore Music Events and
Activities to Celebrate
Hermosa Beach Music
History and Provide
Musical Experiences for
Community and Visitors.
(CMO / CR / Chamber)
The Hermosa Beach
Concert Series will take
place on the two concerts
on the beach in 2024, south
of the Pier, on the two
Sundays following Labor
Day weekend, September
8, 2024 and September 15,
2024. The title of the event
is general, not specific to a
location (such as beach
concerts, for example) so
there are opportunities to
consider expanding the
concerts, such as to the
parks in the off-season.

The Hermosa Beach Concert
Series took place on Sunday,
September 7, and Sunday,
September 14.

MindTravel Live-to-Headphones
'Silent' Piano Concert event
occurred on August 19 and
October 19:
https://www.mindtravel.com/

18 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update

26. (M)
Development Assistance
Committee/ Development
Review Committee (CD)
The department convenes
bi-weekly development
review meetings internally
to identify project
requirements early in the
process. The requirements
are conveyed to applicants,
which frequently are
business owners, so they
can decide how to proceed.

The department continues to
convene bi-weekly development
review meetings internally to
identify project requirements for
applicants early in the process and
to improve department
coordination for streamlining of the
development review process
overall. The requirements are
conveyed to applicants, which
frequently are business owners, so
they can decide how to proceed.

In 2025, the inter-departmental
teams reviewed 45 development
projects and discussed 25 topics
of mutual interest that improve
inter-departmental coordination.

27. (M)
Provide Customer Service
Training to All City Staff to
Build on Culture of
Excellent Customer
Service. (CMO)
In May of 2024, the City
facilitated in-person
customer service training
for all City employees. The
training will be offered again
in the future for new
employees. The training
focused on understanding
the needs of the customer
while balancing staff morale
and workload.

In May of 2024, the City facilitated
in-person customer service
training for all City employees. The
training will be offered again in the
future for new employees. The
training focused on understanding
the needs of the customer while
balancing staff morale and
workload.

There was no additional activity
related to this strategic action in
2025.

28. (L)
Continuous improvements
to streamline processes
and reduce approval times
for permit processes. (CD)
In May 2024, the
Community Development
Department secured an
additional plan review firm
to meet plan review volume
In August 2025, Community
Development updated its plan
check review process from a linear
review process to a concurrent
review. Plan checks are reviewed
The City continues to streamline
development review and reduce
permit approval times. Two new
plan check firms have been
approved to handle increased

19 of 19
Economic Development Strategy—Implementation Priorities and Status Strategic Action July 2024 Progress Update February 2025 Progress Update January 2026 Progress Update and complexity. The
department also updated
application forms and
handouts and changed
internal protocols to funnel
communications to group
emails for more
comprehensive coverage
and response assignment.
concurrently by Building and
Safety and Planning staff reducing
the time from plan check to permit
issuance.
volume and project complexity.

Concurrent plan review is now in
place among Building and
Safety, Public Works, and
Planning. The City is also
expanding use of Accela Citizen
Access, which currently supports
online solar permits, to include
all permit types by early 2026—
allowing online submittal, fee
payment, and real-time status
tracking.

29. (S)
Continue Staff Member
Assigned as Business
Liaison. (CMO)
Complete. Complete. The City maintains an assigned
Business Liaison within the City
Manager’s Office.

30. Regular City Council
Review
Ongoing. Ongoing. Ongoing.

ITEM 17.E
Economic Development Strategy Progress Report

Background
The City’s Economic Development
Strategy was adopted in July 2022 after
two years of monthly committee
engagement and bimonthly working
group meetings.

Background
The strategy includes 30 actions arranged by
implementation timeframe within five broad
categories: Citywide Beautification,
Downtown, Municipal Code Amendments,
Business Outreach, and City Economic
Development Work Program.

CITYWIDE BEAUTIFICATION
Accomplishments for this reporting period:
▪ Funding secured from a major donor for a new gateway
monument sign on the Community Center campus at Pier
and PCH
▪ Downtown Lighting and Beautification Sub-Committee was formed by CC to recommend a spending plan for $100,000
set aside
▪ Two Beautification Awards were presented in April 2025 ▪ The accessible pathway in the Greenbelt was completed ▪ 24 utility boxes have been wrapped with art created by locals

DOWNTOWN
Accomplishments for this reporting period:
▪ The Chamber of Commerce is pursuing the necessary
support to establish a Tourism Improvement District
▪ Downtown Lighting and Beautification Sub-Committee was formed by CC to recommend a spending plan for $100,000
set aside
▪ Between the months of May and September, the City
hosted 13 major special community events
▪ Thirteen businesses have secured permits for on-street outdoor dining.
▪ The complementary holiday parking program was
renewed

MUNI CODE AMENDMENTS
Accomplishments for this reporting period:
▪ In June, 2025, the City Council updated regulations for temporary special events
▪ The business license application process was streamlined

BUSINESS OUTREACH
Accomplishments for this reporting period:
▪ The Police Department held eleven What the Fuzz events with support from local businesses
▪ The City Manager attended a business roundtable
organized by Upper Pier Business and Property Owners
▪ The City collaborated with the Chamber of Commerce on several events, including a workshop on Emergency
Preparedness for Businesses

CITY WORK PROGRAM
Accomplishments for this reporting period:
▪ The Development Review Committee reviewed 45 projects and discussed 25 topics of mutual interest in 2025
▪ Concurrent plan review is now in place among Building and Safety, Planning, and Public Works.
▪ The electronic permitting system, Accela, has been
improved so that many activities – submittals, fee payment and real-time status tracking – will be available online this year.

The City has successfully
aligned its work
program to support
most of the strategic
actions in the plan.

Given that this Strategy
is reaching the limits of
its useful life, staff
recommends retiring
this reporting cycle.

SUMMARY

ECONOMIC DEVELOPMENT

STRATEGY PROGRESS REPORT
Item 17.e

City of Hermosa Beach | Page 1 of 4
Meeting Date: January 27, 2026
Staff Report No. 26-PW-003
Honorable Mayor and Members of the Hermosa Beach City Council

APPROVE THE ACCEPTANCE OF DONATION TO SUPPORT UPGRADES TO THE

BASKETBALL COURT EQUIPMENT AND APPROVE THE INCREASE OF PROJECT CONTINGENCY TO CIP 619 – KELLY COURTS RENOVATION PROJECT (City Engineer Saad Malim)
Recommended Action:

Staff recommends City Council:

1. Accept into the CIP 619 – Kelly Courts Renovation Project budget a donation of funds from The Hermosa Beach Youth Basketball League in the amount of $14,224 for the upgrade of basketball court equipment. (Attachment 2);

2. Add estimated revenue of $14,224 at Account # 301-3908-4201 in the Capital Improvement Project (CIP) Fund 301 for the donation; and

3. Authorize the Director of Public Works to increase the total project contingency amount on the Kelly Courts Improvement project to $244,942 and to approve contract change orders up to the amount of the approved project contingency.

Executive Summary:

On September 30, 2025, City Council awarded a construction contract (Attachment 1) to All-American Construction Solutions (AACS) in the amount of $825,999, with a project contingency of $124,000. The Kelly Courts Renovation Project is currently under construction, and the City has received a generous donation commitment from The Hermosa Beach Youth Basketball League (HBYB) to cover the cost difference between the equipment scoped in the project’s construction documents and the higher-quality equipment requested by HBYB.

Installation of the enhanced basketball equipment would require a contract change order and would work against the $124,000 contract contingency balance that had been set aside for unforeseen conditions or additional work required during construction. The ongoing construction of the Kelly Courts project has resulted in a number of unforeseen site conditions, which has required the use of approximately 94 percent of the available project contingency to date. The remaining Council approved contingency on the project is anticipated to be insufficient for any additional unforeseen conditions while also accommodating the change order for the upgraded basketball equipment.

City of Hermosa Beach | Page 2 of 4
Staff is requesting that City Council authorize the Director of Public Works to increase the total project contingency amount to $244,942 and to approve contract change orders up to the amount of the approved project contingency.

Background:

On September 30, 2025, City Council awarded a construction contract (Attachment 1) to All-American Construction Solutions (AACS) in the amount of $825,999, with a project contingency of $124,000, for a comprehensive renovation of the Kelly Courts. The project scope includes resurfacing and restriping the courts; replacing walls and fencing; installing windscreens; upgrading lighting to meet current standards; replacing basketball infrastructure; and constructing an ADA-compliant access path from the adjacent parking lot. The project will provide a revitalized recreational hub with four pickleball courts, one tennis court, and two basketball courts—safe, accessible, and compliant with modern standards.

Construction commenced on November 17, 2025, and has progressed in accordance with the approved plans and specifications.

During construction, City staff was contacted by Hermosa Beach Youth Basketball (HBYB) with the request to install upgraded basketball equipment at Kelly Courts beyond what had been planned for in the construction documents. HBYB has generously offered to donate the $14,224 cost difference between the equipment scoped in the project’s construction documents and the higher-quality equipment requested by HBYB. The project had planned to install new commercial grade mega-duty basketball systems with standard rims at a cost of $3,047 each and the HBYB request would enhance this equipment with an Ultimate basketball system with clear polycarbonate backboards and breakaway rims which are $6,603 each.

Installation of the enhanced basketball equipment would require a contract change order for the increased amount to install the enhanced equipment and would work against the $124,000 (or approximately 15 percent) contract contingency balance that had been set aside for unforeseen conditions or additional work required during construction.

The ongoing construction of the Kelly Courts project has already resulted in a number of unforeseen site conditions, which has required the use of approximately 94 percent of the available project contingency to date. During construction the actual site conditions varied in the field, on several contract items, from what was anticipated in the construction drawings as the City had limited as-built information for the existing facility and design modifications were required. The remaining Council approved contingency is anticipated to be insufficient to address any additional unforeseen needs, while also accommodating the change order for the upgraded basketball equipment.

City of Hermosa Beach | Page 3 of 4
Past Council Actions
Meeting Date Description
City Council:

September 30, 2025
The City Council Awarded a construction contract for Capital Improvement Program (CIP) Project 619–Kelly Courts
Improvements to All-American Construction Solutions in the amount of $825,999.

Discussion:

Staff recommends City Council approve the increase in the contract contingency by $120,942, which will bring the total project contingency to $244,942. The increase in project contingency will accommodate the additional cost of the upgraded basketball equipment, while providing the necessary flexibility to address any additional unforeseen conditions during construction without causing project delay.

The change in the basketball equipment is not expected to impact the overall schedule as the materials are readily available and the installation will be completed concurrently with other ongoing construction activities.

Fiscal Impact:

The total increase of the project contingency is $120,942. City Council previously approved $949,999 in spending authority for the construction of the project, including $825,999 for AACS’ construction contract and a $124,000 contract contingency.

Staff recommends increasing the project contingency by $120,942 to $244,942. This will cover funding for necessary change orders, including the desired upgraded basketball equipment and unforeseen site conditions. The total revised spending authority with AACS will be $1,070,941.

Acceptance of the $14,244 donation will cover the cost difference for the enhanced basketball equipment. Sufficient funds are available in the Capital Improvement Fund to cover the $120,942 increase in contingency. No additional appropriation is required.

Agreement Modification Request
Agreement
Current
Authorized
Amount
FY 2025-26 Budget
Dept. Account #
Modified
Request
Amount
Total Revised
Contract
Amount
All-American
Construction Solutions
$250,000
$310,000
$265,999
122-8619-4201
125-8619-4201
301-8619-4201
$250,000
$310,000
$265,999
Project Contingency $124,000 301-8619-4201 $120,942 $244,942 Total $949,999 $120,942 $1,070,941

City of Hermosa Beach | Page 4 of 4
Attachments:

1. All-American Construction Solutions fully executed Contract

2. Draft Donation Agreement
Respectfully Submitted by: Kristian Alarcon, Assistant Engineer Concur: Randy Nguyen, Senior Engineer
Concur: Saad Malim, City Engineer
Concur: Joe SanClemente, Public Works Director
Noted for Fiscal Impact: Brandon Walker, Administrative Services Director Legal Review: Jason Baltimore, Interim City Attorney
Approved: Steve Napolitano, City Manager

City of Hermosa Beach
Civic Center, 1315 Valley Drive, Hermosa Beach, CA 90254-3885 BBK (2026) Page 1 of 7 DONATION AGREEMENT

DONATION AGREEMENT

BETWEEN

THE CITY OF HERMOSA BEACH
AND

THE HERMOSA BEACH YOUTH BASKETBALL LEAGUE
This donation agreement (“Agreement”) is made and entered into as of [________], 2026 (“Effective Date”), by and between the City of Hermosa Beach (a municipal corporation organized and operating under the laws of the State of California with its principal place of business at 1315 Valley Drive, Hermosa Beach, California 90254) (“City”) and the Hermosa Beach Youth Basketball League (a California nonprofit public benefit corporation doing business from its branch office located at 710 Pier Avenue, Hermosa Beach, California 90254) (“Donor”). City and Donor are hereinafter sometimes referred to individually as “Party” and collectively as the “Parties”.

RECITALS
A. Donor is an organization that desires to make a donation (“Donation”) to the City to cover the increased cost of upgraded basketball court equipment (“Equipment”) at the Kelly Courts Basketball Courts (“Kelly Courts”); and B. Donor wishes to provide the Donation to the City as a gift, subject to the conditions described in this Agreement; and
C. The Parties desire by this Agreement to establish the terms for City to accept the donation pursuant to California Government Code section 37354.

NOW, THEREFORE, IT IS AGREED AS FOLLOWS:

AGREEMENT

1. Incorporation of Recitals. The recitals above are true and correct, and are hereby incorporated herein by this reference.

2. Donation. Donor hereby agrees to make a Donation to the City in the amount of fourteen thousand two hundred and twenty four dollars ($14,224) to be used to cover the increased cost of the installation of the Equipment. The Kelly Courts Project

City of Hermosa Beach
Civic Center, 1315 Valley Drive, Hermosa Beach, CA 90254-3885 BBK (2026) Page 2 of 7 DONATION AGREEMENT
(Capital Improvement Program Project 619) planned to install new Equipment, and the Donation will cover the increased cost for the Equipment versus the cost planned to be incurred by the City under the current construction contract. Donor shall deliver the Donation to the City concurrently herewith.

3. Location of Equipment. The new Equipment shall be installed within the Kelly Courts in the same locations as the former Equipment as set forth in the site plan at Exhibit A, attached hereto and incorporated herein by reference.

4. Installation of Basketball Court Equipment
a. The Equipment shall be installed by the City’s licensed contractor (approved by the City in its reasonable discretion) as set forth in the submittal at Exhibit B, attached hereto and incorporated herein by reference. b. Donor shall not exercise supervision over an employee or official of the City. Donor shall not perform or oversee any work under this Agreement as an independent contractor and shall not as an agent or employee of the City. Donor hereby waives any claims for any compensation or benefits in relation to their financial donation towards the Equipment.

5. Waiver of Rights
a. Donor is familiar with the California Art Preservation Act (California Civil Code section 987 et seq.), and Visual Artists' Rights Act of 1990 and Copyright Act of 1976 (Section 101 et seq. to Title 17 of the U.S. Code); and expressly waives Donor’s rights under those Acts to the extent permissible therein in connection with the installation of the Equipment.
b. Donor expressly waives any and all rights and benefits conferred upon it by the provisions of section 1542 of the California Civil Code which reads as follows: “A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE

CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN

HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF

KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”

BBK (2026) Page 3 of 7 DONATION AGREEMENT
c. This waiver shall be effective as a bar to any and all actions, fees, damages, losses, claims, liabilities, and demands of whatsoever character, nature, and kind (that are known or unknown, or suspected or unsuspected, including without limitation the Acts). Donor further represents and warrants that it understands this waiver and that if it does not understand this waiver, it shall seek the advice of a qualified attorney before executing this Agreement.

6. Notice. Any notice or instrument required to be given or delivered by this Agreement may be given or delivered by depositing the same in any United States Post Office (certified mail, return receipt requested, postage prepaid, and addressed to the following addresses) and shall be effective upon receipt thereof:

CITY
City of Hermosa Beach
1315 Valley Drive
Hermosa Beach, California 90254
Attn: [_______]
DONOR
Hermosa Beach Youth Basketball
710 Pier Avenue
Hermosa Beach, California 90254
Attn: Dan Madden
President

7. Laws and Venue. This Agreement shall be interpreted in accordance with the laws of the State of California. If any action is brought to interpret or enforce any term of this Agreement, the action shall be brought in a state or Federal court situated in the County of Los Angeles, State of California.

8. Severability. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal, or unenforceable for any reason, such determination shall not affect the validity or enforceability of the remaining terms and provisions hereof or of the offending provision in any other circumstance; and the remaining provisions of this Agreement shall remain in full force and effect.

9. Time of Essence. Time is of the essence for each and every provision of this Agreement.

10. Headings. Paragraphs and subparagraph headings contained in this Agreement are included solely for convenience and are not intended to modify, explain, or to be a full or accurate description of the content thereof; and shall not in any way affect the meaning or interpretation of this Agreement.

BBK (2026) Page 4 of 7 DONATION AGREEMENT

11. Amendments. Only a writing executed by all of the Parties hereto or their respective successors and assigns may amend this Agreement.

12. Authority. The persons executing this Agreement on behalf of the Parties hereto warrant that they are duly authorized to execute this Agreement on behalf of said Parties; and that by doing so, the Parties hereto are formally bound to the provisions of this Agreement.

13. Entire Agreement. This Agreement (including the Exhibits) represents the entire understanding of the Parties as to those matters contained herein; and supersedes and cancels any prior or contemporaneous oral or written understanding, promises, or representations with respect to those matters covered hereunder. Each Party acknowledges that no representations, inducements, promises, or agreements have been made by any person which are not incorporated herein, and that any other agreements shall be void. This is an integrated Agreement.

14. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original. All counterparts shall be construed together and shall constitute one single Agreement.

15. Electronic Signature. Each Party acknowledges and agrees that this Agreement may be executed by electronic or digital signature, which shall be considered as an original signature for all purposes and shall have the same force and effect as an original signature.
[SIGNATURES ON FOLLOWING PAGE]

BBK (2026) Page 5 of 7 DONATION AGREEMENT

SIGNATURE PAGE
FOR

DONATION AGREEMENT

BETWEEN

THE CITY OF HERMOSA BEACH
AND

THE HERMOSA BEACH YOUTH BASKETBALL LEAGUE
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

CITY OF HERMOSA BEACH
APPROVED BY:

Steve Napolitano
City Manager
ATTESTED BY:

Reanna Guzman
Interim City Clerk
APPROVED AS TO FORM:

Best Best & Krieger LLP
Interim City Attorney

HERMOSA BEACH YOUTH

BASKETBALL LEAGUE

Dan Madden
President

BBK (2026) Page 6 of 7 DONATION AGREEMENT

EXHIBIT A
SITE PLAN – KELLY COURTS BASKETBALL COURT LAYOUT

BBK (2026) Page 7 of 7 DONATION AGREEMENT

EXHIBIT B

ORIGINAL & PROPOSED ENHANCED BASKETBALL COURT SYSTEMS

5-9/16" Mega Duty Finished Aluminum Fan Playground Basketball System MSRP: $3,215.00
Safe Play Area
Quantity
SKU: PR75
UPC: 090053302060
Categories: 5-9/16'' Gooseneck Systems, Best Sellers, Outdoor Basketball, View in catalog : Page 85
Bison's PR75 package includes: BA780 Mega-Duty 5-9/16" O.D., hot dip galvanized steel pipe with 72" safe play area (or order PR75XL for 96" safe play area), heavy 1-5/8" backboard braces, 48" in-ground bury (Lifetime limited warranty); BA475SS fan-shaped 35-1/2" x 54" • backboard made of durable, rust-free aluminum with heavy support ribs, white powder coated finish, and orange shooter's square and border (Lifetime limited warranty); and BA39U Ultimate playground goal with double 5/8" steel rim, No-Fail netlocks to add strength and eliminate netlock breakage, 3/16" thick steel box-style backplate and rim supports, accepts nylon or optional chain nets (Unconditional lifetime replacement warranty). Add additional BA700PP pole padding for increased player safety. No Substitutions. 1/1
72"
1 Add to Quote
Description
Quote Request
Give us a call at 800-247-7668 or chat with a product specialist to find the right equipment for your facility! Chat
1 Quote (0)
Basketball Equipment in original
scope of project

Updated/Revised Basketball
Equipment for the project

APPROVE THE INCREASE OF

PROJECT CONTINGENCY TO
CIP 619 – KELLY COURTS

RENOVATION PROJECT
JANUARY 27, 2026

Background
 On September 30, 2025, City Council
awarded a construction contract to AllAmerican Construction Solutions (AACS) for CIP 619 Kelly Courts Renovations in the
amount of $825,999 plus a contingency of
$124,000.
 Project scope includes:
– New fencing and ADA upgrades
– New lights including 4 new sports light poles
– Electrical upgrades
– Newly resurfaced basketball, tennis and pickleball
courts on resized courts
– New basketball, tennis and pickleball equipment

Discussion
 Ongoing construction has resulted in a
number of unforeseen site conditions requiring
use of 94 % project contingency.
 Unforeseen conditions largely due to limited
as-built information, and include:
 Buried utility pull boxes
 Removal of unknown buried fence and
light pole footings
 Relocation of buried irrigation, water and
electrical lines due to utility conflicts
 Tennis and pickleball court surface is
concrete with asphalt overlay with
extensive cracking

Discussion
 Hermosa Beach Youth Basketball
requests to install upgraded
basketball equipment
 HBYB has generously offered to
donate $14,224 to cover the cost
difference to upgrade four (4)
basketball hoop systems
 City pays for this upgrade to the
contractor as a change order
Hermosa Beach Youth Basketball (HBYB)
Donation for Basketball Equipment Upgrades

Discussion
 Sufficient funding is available in the CIP
project budget to cover the increase in
contingency and no additional
appropriation is required
 Schedule Impacts
 Current rain delays as well as change order
work push project completion to end of March
2026
 Use of batting cages and access to Clark Field
for HB Little League to be fully available by
mid-February

Recommendation

1. Accept into the CIP 619 – Kelly Courts Renovation
Project budget a donation of funds from The
Hermosa Beach Youth Basketball League in the
amount of $14,224 for the upgrade of basketball
court equipment;

2. Add estimated revenue of $14,224 at Account #
301-3908-4201 in the Capital Improvement Project
(CIP) Fund 301 for the donation; and

3. Authorize the Director of Public Works to increase
the total project contingency amount on the Kelly
Courts Improvement project to $244,942 and to
approve contract change orders up to the amount
of the approved project contingency.

City of Hermosa Beach | Page 1 of 1
Meeting Date: January 27, 2026
Staff Report No. 26-CMO-006
Honorable Mayor and Members of the Hermosa Beach City Council

TENTATIVE FUTURE AGENDA ITEMS
Attached is the current list of tentative future agenda items for Council’s information.

The tentative future agenda provides a preliminary preview of topics planned for discussion at upcoming City Council meetings over a specified period, typically the next three months. The items listed in this document are "tentatively" scheduled, meaning they are subject to change and should not be considered final until the official agenda for each meeting is posted. This document is a work in progress and offers a glimpse into the City's priorities and planned discussions, allowing stakeholders to anticipate and prepare for potential topics of interest.

Key Features of a Tentative Future Agenda Document:

1. Tentative Schedule: Each agenda item is assigned a tentative date, indicating when it is expected to be discussed. These dates are provisional and may be adjusted based on various factors.

2. Work in Progress: The document is continuously updated as new items emerge, priorities shift, or additional information becomes available. This flexibility ensures City Council can address the most pressing issues in a timely manner.

3. Transparency and Communication: By publishing a tentative future agenda, the City aims to maintain transparency with residents, businesses, and other stakeholders. It helps the community stay informed about potential topics of discussion and provides an opportunity for public engagement and preparation.

4. Fluid Scheduling: The scheduling of agenda items is fluid until the official agenda for a specific City Council meeting is posted. Changes can occur due to various reasons, such as new developments, additional preparatory work required, or changes in workload or priority.

Attachment:

Tentative Future Agenda Items

January 22, 2026
Honorable Mayor and Members Regular Meeting of
of the Hermosa Beach City Council January 27, 2025

TENTATIVE FUTURE AGENDA ITEMS
FEBRUARY 3, 2026 @ 5:00 PM INITIAL

DATE CLOSED SESSION
FEBRUARY 3, 2026 @ 6:00 PM

PRESENTATIONS
K9 ARMOR X K9 ARCO PRESENTATION

HERMOSA BEACH CHAMBER OF COMMERCE PRESENTS
REVIEW OF 2025 PROGRAMS AND VISION FOR 2026

RECOGNIZING BLACK HISTORY MONTH

CONSENT CALENDAR
City Council Minutes City Clerk Ongoing
Check Registers Administrative Services Director Ongoing Revenue Report, Expenditure Report, and CIP Report by Project for November 2025
Administrative Services Director Ongoing
City Treasurer’s Report for December 2025 City Treasurer Ongoing

MUNICIPAL MATTERS
Adopt a Resolution to Adopt a Side Letter to Memorandum of Understanding (MOU) Between the City of Hermosa Beach and the General and Supervisory Employees’ Bargaining Unit, Teamsters Local 986, and the Professional and Administrative Employee Group
Interim Human Resources Manager Staff Request
Jan. 21, 2026
Approval of Military Equipment Use by The Hermosa Beach Police Department Pursuant to Assembly Bill 481
Police Chief Annual
Award of Contract to Geosyntec for Professional Stormwater Consulting Services
Environmental Programs Manager Staff Request
Nov. 20, 2025
Adjustment of Fees for Commercial Encroachment Areas Environmental Programs Manager Staff Request Jan. 20, 2026
FUTURE AGENDA ITEMS – CITY COUNCIL
Future Agenda Items City Manager Ongoing

INFORMATIONAL ITEMS
Parking Citation and Revenue Report – January 2026 Senior Management Analyst Ongoing

2 FEBRUARY 24, 2026 @ 5:00 PM INITIAL

DATE CLOSED SESSION
FEBRUARY 24, 2026 @ 6:00 PM

PRESENTATIONS

ELECTION OF MAYOR AND MAYOR PRO TEMPORE

CONSENT CALENDAR
City Council Minutes City Clerk Ongoing
Check Registers Administrative Services Director Ongoing Cash Balance Report for December 2025 Administrative Services Director Ongoing Revenue Report, Expenditure Report, and CIP Report by Project for December 2025
Administrative Services Director Ongoing
City Treasurer’s Report for January 2026 City Treasurer Ongoing

INFORMATIONAL ITEMS
Action minutes of the Parks, Recreation and Community Resources Advisory Commission Meeting of January 6, 2026
Community Resources Director Ongoing
Los Angeles County Fire and Ambulance Monthly Report for December 2025 Emergency Management Coordinator
Ongoing
Police Crime Statistics for January 2026 Police Chief Ongoing Action minutes of the Planning Commission Meeting of February 17, 2026 Community Development Director Ongoing (RECEPTION TO FOLLOW MEETING)

3 MARCH 10, 2026 @ 5:00 PM INITIAL

DATE CLOSED SESSION
MARCH 10, 2026 @ 6:00 PM

PRESENTATIONS

PROCLAMATION RECOGNIZING RED CROSS MONTH
PROCLAMATION RECOGNIZING WOMEN’S HISTORY MONTH

CONSENT CALENDAR
City Council Minutes City Clerk Ongoing
Check Registers Administrative Services Director Ongoing Cash Balance Report for December 2025 Administrative Services Director Ongoing Revenue Report, Expenditure Report, and CIP Report by Project for December 2025
Administrative Services Director Ongoing
City Treasurer’s Report for February 2026 City Treasurer Ongoing PUBLIC HEARINGS – 6:30 PM
Zoning Code Update - Administrative Procedures, Planning Manager Staff Request Jul. 23, 2025

MUNICIPAL MATTERS
Possible support for the establishment of the South Bay Housing Trust Community Development Director Staff Request Dec. 22, 2025
Informational Item:

Assessment of cost, staffing, operational requirements for PD to establish a more consistent/visible presence along the Strand, beach, and parks.

Designated officers focused on visibility, proactive engagement, education, and enforcement in our most heavily used public spaces (supported by:

Jackson and Detoy)
AND
Discussion of contract officers as discussed at the Safety Forum. (supported by: Saemann and Keegan)
Council Direction
Oct. 28, 2025
and
Dec. 9, 2025
FUTURE AGENDA ITEMS – CITY COUNCIL
Future Agenda Items City Manager Ongoing

INFORMATIONAL ITEMS
Action minutes of the Parks, Recreation and Community Resources Advisory Commission Meeting of February 10, 2026
Community Resources Director Ongoing
Parking Citation and Revenue Report – February 2026 Senior Management Analyst Ongoing \

4 MARCH 24, 2026 @ 5:00 PM INITIAL

DATE CLOSED SESSION
MARCH 24, 2026 @ 6:00 PM

CONSENT CALENDAR
City Council Minutes City Clerk Ongoing
Check Registers Administrative Services Director Ongoing Cash Balance Report for January 2026 Administrative Services Director Ongoing Revenue Report, Expenditure Report, and CIP Report by Project for January 2026
Administrative Services Director Ongoing
City Treasurer’s Report for March 2026 City Treasurer Ongoing

MUNICIPAL MATTERS
Dog Park Proposal Review (supported by City Council) Community Resources Director Council Direction Mar 11, 2025
FUTURE AGENDA ITEMS – CITY COUNCIL
Future Agenda Items City Manager Ongoing

INFORMATIONAL ITEMS
Action minutes of the Public Works Commission Meeting of January 21, 2026
Community Resources Director Ongoing
Los Angeles County Fire and Ambulance Monthly Report for January 2025 Emergency Management Coordinator
Ongoing
Police Crime Statistics for February 2026 Police Chief Ongoing Action minutes of the Planning Commission Meeting of March 17, 2026 Community Development Director Ongoing

5 PENDING NEW ITEMS

STATUS /

TENTATIVE MEETING DATE
(Updated 12/29/25)
Approval of the Municipal Lease Policy
Initiated by: Staff Request Jun. 12, 2018
Community Resources
Director
Awaiting professional building
assessment of the Kiwanis
Building, Rotary Building, and
Lawn Bowling Club to
determine the level of
maintenance, repairs, and
future upgrades that may be
needed and required by the
City.

Landscape and Street Lighting District Assessment Adjustment (mail-in election authorization)
Initiated by: Council Direction Jul. 9, 2019
Public Works Director Pending staff availability. If
council agrees to advance the
adjustment, it will need to go to
a citywide ballot in compliance
with Proposition 218.

Emergency Services Municipal Code Chapter 2.56 Update Emergency Management
Coordinator
Waiting for State to review
proposed language changes
Consideration of licensing agreement/fees for use of City logo Initiated by: Council Direction Jun. 9, 2020
City Attorney The City will develop a
licensing agreement for
commercial uses of the City
logo as part of a comprehensive
Administrative Memorandum
(AM) on City Branding and
Logo Use by City Staff. City
staff will begin drafting the
AM after finalizing the City’s
style guide and filing its “Intent
to Use” trademark application
for the City logo with the
USPTO. As part of developing
a Licensing Agreement for the
Commercial Use of the City
Logo, staff will establish a
process for reviewing and
handling these requests. This
process will likely include the
negotiation of royalties and as
well as the preparation of a
staff report to obtain Council
approval to enter into the
agreement. Only after the City
receives the issuance of a
Notice of Allowance from the
USPTO can it begin approving
applications for commercial
uses of the logo.

Parks, Recreation, and Community Resources Advisory Commission Volleyball Court Use Subcommittee was formed to review all aspects of the beach volleyball courts located in the residential area Initiated: 2021
Community Resources
Director To be completed in the first
quarter of 2026.

PLAN Hermosa 5-year check-in on milestones
(Supported by Massey, Campbell, Armato, Jackson)
Initiated by: Council Direction October 26, 2021
Community
Development
Director/Environmental
Program Manager
The next update to City
Council will be in 2026
Consideration of rules that would govern operation of off-sale alcohol establishments in downtown and consideration of queuing for on-sale alcohol establishments. (supported by Massey, Saemann and Detoy) Initiated by: Council Direction June 13, 2023
Community
Development/Police
Chief/Deputy City
Manager
Ordinance to be established to
address items.

6 Citywide Engineering and Traffic Survey and review of provisions in California Assembly Bill 43 that are anticipated to become effective on or about June 30, 2024.

Initiated by: Unanimous Council Direction July 25, 2023 Public Works Director Pending staffing availability
and completion of other
previously requested future
agenda items. Targeting
Summer 2026.

Request Public Works Commission to review fines and other consequences involved with illegal tree removal and return to Council as an action item for discussion and deliberation. (supported by Saemann, Francois, Detoy) Initiated by: Council Direction August 13, 2024
Public Works Director Pending staffing availability
and completion of other
previously requested future
agenda items.

Explore Best Practices for Undergrounding. (supported by: Detoy, Saemann, and Jackson)
Initiated by: Council Direction November 12, 2024
Public Works Director Pending staffing availability
and completion of other
previously requested future
agenda items. Staff will also
need to request funding in the
future budget cycle to support
bringing in appropriate
consulting expertise on this
item.

Refer the public pool discussion to the Parks, Recreation, and Community Resources Advisory Commission for review prior to City Council. (supported by Saemann, Detoy, and Jackson)
Initiated by: Council Direction June 24, 2025
Community Resources
Director Pending Commission Review
Request for Staff to prepare an item outlining the Hermosa Beach Lawn Bowling Club’s (HBLBC) operations, including maintenance, membership, and legal considerations relevant to its current use and management, and to have the item be presented to the Parks, Recreation, and Community Resources Advisory Commission prior to City Council.
(supported by Jackson, Detoy, and Keegan)
Initiated by: Council Direction June 24, 2025
Community Resources
Director/Public Works
Director/City Attorney To be reviewed by Parks & Rec
Commission in February 2026
Consider adding another accessible mat, extending the "T" to the water line, and seek grant funding to study a permanent solution to the current accessible mat setup.
(supported by: Francois, Saemann and Jackson)
Initiated by: Council Direction August 26, 2025
Public Works Director Pending staffing availability
and completion of other
previously requested future
agenda items. Targeting early
Spring 2026.

Agendize discussion on Rosenberg’s Rules of Order and Robert’s Rules of Order at the next City Council Retreat
(supported by: Detoy and Jackson)
Initiated by: Council Direction September 9, 2025
City Manager The next City Council Retreat
will be scheduled once a
permanent City Manager is
appointed
Informational Item to discuss identification requirements for alcohol-serving establishments, and if feasible, include input from the Alcoholic Beverage Control, and include available technology that is available to combat fake identifications
(supported by: Jackson and Detoy)
Initiated by: Council Direction September 9, 2025
Planning Commission
Informational Item expected in
February 2026.

Informational Item for Public Works Commission to study maximizing and expanding the street parking inventory through the analysis of the City's red curb standard to include studying golfcart parking spaces for reduced streets and studying the Driveway Parking Permit Program.
(supported by: Jackson and Saemann)
Initiated by: Council Direction September 9, 2025
Public Works Director Pending staffing availability
and completion of other
previously requested future
agenda items.

Informational Item to review the feasibility of collecting Transient Occupancy Tax (TOT) for short-term vacation rentals that are out of compliance, and of collecting unpaid fines from illegal short-term vacation rentals.
(supported by: Jackson and Saemann)
Initiated by: Council Direction September 9, 2025
Administrative Services
Director Staff will come back to Council
in the next few months for an
update.

Informational Item to delineate available options for licensing, registration, or other regulatory tools to support e-bike safety and compliance. (supported by: Jackson and Saemann)
Initiated by: Council Direction December 9, 2025
City Attorney/Police
Chief

Power BI Desktop Los Angeles County Fire Department - Incident Response Data 11/1/2025  11/30/2025  Incident Responses by Apparatus Type
0 200
November
2025
232
141
91 11 - Engine 76 - ALS unit
Total Responses by Apparatus Type
Incident Description 11 - Engine 76 - ALS unit Total

321 - EMS call, excluding vehicle accident with injury 62 57 119 300 - Rescue, emergency medical call (EMS) call, other 25 24 49 600 - Good intent call, other 24 3 27
611 - Dispatched & cancelled enroute 10 1 11
700 - False alarm or false call, other 10 1 11
251 - Excessive heat, scorch burns with no ignition 2 1 3 322 - Vehicle accident with injuries 2 1 3
112 - Fires in structures other than in a building 1 1 2 320 - Emergency medical service, other 1 1 2
900 - Special type of incident, other 1 1 2
113 - Cooking fire, confined to container 1 1
531 - Smoke or odor removal 1 1
911 - Citizen complaint 1 1
Total 141 91 232
Incident Responses by Day
0 20 40
1 Monday
2 Tuesday
3 Wednesday
4 Thursday
5 Friday
6 Saturday
7 Sunday
38 27
27 33
35 33
39 Incident Response Time of Day
(24hr Format)
0 5 10 15 20
0 10
20 12
13 21
2 21
4 Average Monthly Call Answer Time (Seconds)
0 2
November
2025
3

Power BI Desktop McCormick Ambulance Services - Incident Response Data 11/1/2025  11/30/2025  Incident Responses Transported vs Canceled
0 50
100
November
2025
100
33 67
Canceled Transported
Incident Responses by Day
0 10 20
1 Monday
2 Tuesday
3 Wednesday
4 Thursday
5 Friday
6 Saturday
7 Sunday
12 10
12 15
15 15
21 Incident Response Time of Day
(No Cancels)
0 5 10
12:00 AM
6:00 AM
12:00 PM
6:00 PM
6 4
11 1
9 Monthly - Code 3 Response <9:00mins

0.00%

50.00%
100.00%
November
2025
76%
24%
Within Allowable Time Delayed Response
Monthly - Code 2 Response <15:00 mins

0.00%

50.00%
100.00%
November
2025
98%
Within Allowable Time Delayed Response
Code 2 Response <15:00 mins
41 (97.62%)
1 (2.38%)
Within Allowable Time Delayed Response
Code 3 Response <9:00mins
19 (76%)
6 (24%)
Within Allowable Time Delayed Response

Power BI Desktop
Monthly National Incident Based Reporting System (NIBRS) Data 0 50
100
2025 January 2025 February 2025 March 2025 April 2025 May 2025 June 2025 July 2025 August 2025 September
2025 October 2025
November
2025
December
76 70
78 69
58 62
101 102
52 56
42 67
8 11 8 8
13 13 18 9 10
52 48 51 48 40 37
61 66
37 35
26 42
16 15
16 13
10 12
27 18
13 12
11 15
Offense Category Crimes Against Persons Crimes Against Property Crimes Against Society Year
2025


Month
All


National Incident Based Reporting System (NIBRS) Data - Category Totals by Month Crimes Against Persons
Crimes Against Property
Crimes Against Society
0 10
20 8
10 18
2 11
9 5
7 13
8 13
8 20
40 60
80 52
42 66
26 37
48 51
40 35
61 48
37 10
20 30
16 15
27 10 11
15 16
13 12 13
18 12
Jan 2025 Mar 2025 May 2025 Jul 2025 Sep 2025 Nov 2025
Police Department - Crime Dashboard
Offense Category Breakdown
(13.45%)
(65.19%)
(21.37%)
112
543
178
FBI Definitions for
National IncidentBased Reporting
System (NIBRS):
https://ucr.fbi.gov/nibrs
/2018/resourcepages/nibrs_offense_de
finitions-2018.pdf
833
Total Crimes

Power BI Desktop
National Incident Based Reporting System (NIBRS) Data - Month over Month % Change 0 20
40 60
80 100
-60%
-40%
-20%
0%
20%
40%
60%
80%
January February March April May June July August September October November December 68 64
58 40
80 72
73 66
58 77
53 47
76 70
78 69
58 62
101
102
52 56
42 67
62% 60%
63%
-49%
-16%
-25%
8%
-8%
11%
-12%
7%
1%
Prior Year Crimes
Current Year Crimes
MoM % Change
Year
2025


Month
All

Police Department - Crime Dashboard 
2025
Year
833
# of Crimes
National Incident Based Reporting System (NIBRS) Data - Month over Month % Change -50%
0%
50%
2025 January 2025 February 2025 March 2025 April 2025 May 2025 June 2025 July 2025 August 2025 September 2025 October 2025 November 2025 December

61.70%
-7.89%

11.43%
-11.54% -15.94%

6.90%

62.90%

0.99%
-49.02%

7.69%
-25.00%

59.52%

Power BI Desktop
Moped/Scooter/
Motorcycle
4 Bicycle
22 E-bike
60 Unknown
11 Citation Issuance Type
67 (69.07%)
30 (30.93%)
Traffic Non-Traffic
Citations Issued by Device Type
0 5
10 15
20 January
February
March
April
May
June
July
August
September
October
November
December
2025
4 9
3 12
1 6
2 12
19 1
9 19
Moped/Scooter/Motorcycle Bicycle E-bike Unknown
Citations Issued by Location
© 2026 TomTom, © 2026 Microsoft Corporation
Bicycle Related Citations Issued - 2025
*Data only reflects citations that reference a bike or E-bike violation and may not capture other violations like running a stop sign, not wearing a helmet, etc. Page 881 of 893 1 CITY OF HERMOSA BEACH

PUBLIC WORKS COMMISSION MEETING MINUTES
November 19, 2025
Open Session 6:00 PM
Council Chambers
1315 Valley Drive
Hermosa Beach, CA 90254
Members Present: Chairperson Scott Hayes, Vice Chairperson David Grethen, Commissioner Kathy Dunbabin, Commissioner Janice Brittain Members Absent: Commissioner Thor Legvold
_____________________________________________________________________

1. CALL TO ORDER
Chairperson Hayes called the Open Session to order at 6:03 p.m.

2. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Commissioner Brittain

3. ROLL CALL
Chairperson Hayes, Vice Chairpersdon Grethen, Commissioner Brittain, and Commissioner Dunbabin are present
Commissioner Legvold is absent
Andrew Nguyen announced a quorum.

4. APPROVAL OF AGENDA
Motion to move Item 13 Future Agenda Items just before adjournment Moved by: Vice Chairperson David Grethen
Seconded by: Commissioner Kathy Dunbabin

2 Ayes (4): Chairperson Scott Hayes, Vice Chairperson David Grethen, Commissioner Kathy Dunbabin, and Commissioner Janice Brittain Absent (1): Commissioner Thor Legvold
Motion Carried

5. ANNOUNCEMENTS—UPCOMING CITY EVENTS
Commissioner Dunbabin announced that the Chamber is putting on Hermosa for the Holidays on Saturday and Sunday with the tree lighting occurring at 6pm on Sunday evening. Chairperson Hayes announced that Rock the Tops is on Pier Plaza.

6. PRESENTATIONS
No Presentations.

7. PUBLIC COMMENT
Chairperson Hayes opened public comment. No public comment was provided.

8. COMMISSIONER COMMENTS
No Commissioner Comments were provided.

8.a Response to Public Comments/Questions for Clarification

8.b Brief Announcements

8.c Reports on liaison or subcommittee roles, activities, or meetings attended.

Vice Chairperson Grethen attended the Public Safety Forum by Mayor Saemann, City Manager Napolitano, Chief Phillips. It mainly addressed Homelessness and E-Bikes, and Vice Chairperson Grethen concluded that there would not be any imminent changes to our infrastructure or right of way improvements as a result of the forum.

Vice Chairperson Grethen announced that Council formally went to Robert's Rules of Order
Commissioner Brittain announced they are reactivating the CERT program and if interested please contact Mo or the City.

8.d Brief comments on matters within subject matter jurisdiction of the Commission.

9. CONSENT CALENDAR

9.a Action Meeting Minutes for the September 17, 2025 Public Works Commission Meeting
Vice Chairperson Grethen pulled the item.

3 10. ITEMS REMOVED FROM THE CONSENT CALENDAR FOR SEPARATE

DISCUSSION

10.a Action Meeting Minutes for the September 17, 2025 Public Works Commission Meeting
Vice Chairperson Grethen pulled the item to suggest correction in the minutes under item 8 referencing the Planning Commission that needs to be updated to Parks and Recreation Commission.

Motion to approve the September 17, 2025 minutes with the one change from Planning Commission to Parks and Rec Commission.

Moved by: Vice Chairperson David Grethen
Seconded by: Commissioner Janice Brittain
Ayes (4): Chairperson Scott Hayes, Vice Chairperson David Grethen, Commissioner Kathy Dunbabin, and Commissioner Janice Brittain Absent (1): Commissioner Thor Legvold
Motion Carried

11. PUBLIC HEARINGS
Attachment 7. SUPPLEMENTAL Public Works Commission Memo was added to item 11.a

11.a REQUEST TO REMOVE AND REPLACE ONE TREE IN THE PUBLIC RIGHT-OF-WAY AT 635 LOMA DRIVE - 25-PW-084
Assistant engineer Kristian Alarcon presented the item.

Chairperson Hayes, Vice Chairperson Grethen, Commissioner Brittain, and Commissioner Dunbabin asked questions of staff.

No public comment
Motion to approve the recommended action, but accept the two replacement trees at same location onsite rather than elsewhere in the City.

Moved by: Commissioner Kathy Dunbabin
Seconded by: Commissioner Janice Brittain
Ayes (4): Chairperson Scott Hayes, Vice Chairperson David Grethen, Commissioner Kathy Dunbabin, and Commissioner Janice Brittain Absent (1): Commissioner Thor Legvold
Motion Carried

4 12. MATTERS FOR COMMISSION CONSIDERATION

12.a APPOINTMENT OF PUBLIC WORKS COMMISSION CHAIRPERSON AND VICE CHAIRPERSON AND MEETING SCHEDULE FOR 2026 - 25- PW-087
Public Works Director Joe SanClemente presented the item.

Appointment of Public Works Commission Chairperson and Vice Chairperson traditionally based on seniority. Based upon this, Vice Chairperson Grethen would become Chair and Commissioner Legvold would become Vice Chair.

Meeting schedule for 2026 will be the Third Wednesday of each month every other month with meeting times beginning at 6:00pm.

Chairperson Hayes had a question about term limits.

No public comment
Motion to accept the recommendation of the Staff.

1. Appoint the Public Works Commission Chairperson and Vice Chairperson for January 2026 through December 2026; and

2. Receive and file the Public Works Commission Meeting Schedule for 2026.

Moved by: Commissioner Janice Brittain
Seconded by: Commissioner Kathy Dunbabin
Ayes (4): Chairperson Scott Hayes, Vice Chairperson David Grethen, Commissioner Kathy Dunbabin, and Commissioner Janice Brittain Absent (1): Commissioner Thor Legvold
Motion Carried

12.b JOINT CITY COUNCIL AND PUBLIC WORKS COMMISSION

SUBCOMMITTEE TO EXPLORE THE ROLES AND RESPONSIBILITIES
OF THE PUBLIC WORKS COMMISSION - 25-PW-092
Public Works Director Joe SanClemente presented the item.

Chairperson Hayes asked questions of staff about when meetings would begin and what the schedule would be for the subcommittee.

No public comment.

All members of the Public Works Commission expressed interest in joining the joint City Council and Public Works Commission subcommittee and presented their case as to why they should serve on the subcommittee.

5 Motion to appoint Chairperson Hayes and Commissioner Brittain to the joint City Council and Public Works Commission subcommittee Moved by: Vice Chairperson David Grethen
Seconded by: Commissioner Kathy Dunbabin
Ayes (4): Chairperson Scott Hayes, Vice Chairperson David Grethen, Commissioner Kathy Dunbabin, and Commissioner Janice Brittain Absent (1): Commissioner Thor Legvold
Motion Carried

13. FUTURE AGENDA ITEMS

14. PUBLIC WORKS DIRECTOR REPORT
Public Works Director Joe SanClemente provided updates.

14.a Director's Update
The City removed the temporary ADA access mats at 2nd Street and 22nd Street. These mats are typically installed during the beach season (April– October) and were removed due to ongoing beach maintenance, tidal conditions, and storm surge, which make ADA access difficult to maintain during this period. The ADA mat at 11th Street remains in place and will continue to be monitored to ensure a clear and accessible path. The ADA mats at 2nd Street and 22nd Street are planned to be reinstalled in the spring.

The City recently hired a new Senior Engineer, Randy Nguyen, who started on October 30. He previously worked for the City of Orange.

One engineer is currently out on maternity leave; however, the department is close to being fully staffed.

Chairperson Hayes asked questions of staff about the status of the 14th Street restrooms. Director SanClemente provided an update, noting that repair work is underway. Contractors have been hired and parts have been ordered. Equipment will be rented to remove sand from around the building to allow repairs to proceed. Work is expected to begin in a couple weeks and should hopefully be completed by February. Chairperson Hayes asked follow-up questions of staff regarding storm drain outflows.

14.b Activity Reports
Public Works Director Joe SanClemente and City Engineer Saad Malim presented this item.

Vice Chairperson Grethen had questions of staff about installing signs on greenbelt about reclaimed water for irrigation and Administrative Citations for encroachment violations.