STAFF REPORT
Meeting Date:
March 24, 2026
CONSENT
15 SUBJECT: 2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025
HOMELESS SHELTER INSPECTION REPORT
RECOMMENDATION: It is recommended that the City Council:
1. Receive and accept the 2025 Housing Element Annual Progress Report and Homeless Shelter Inspection Report, and authorize staff to submit such reports to the California Department of Housing and Community Development; and
2. Find that the recommended action is not a project within the meaning of the State CEQA Guidelines Section 15378(b) or, alternatively, is exempt under State CEQA Guidelines Section 15061(b)(3).
SUMMARY OF THE MATTER
Government Code section 65400 requires that each city, county, or city and county, including charter cities, prepare an Annual Progress Report (“APR”) on the status of the housing element of its general plan and progress in its implementation, using forms and definitions adopted by the California Department of Housing and Community Development (“HCD”). One primary function of the housing element APR data is for HCD to track each local government’s annual progress towards meeting its Regional Housing Needs Allocation (“RHNA”) and over the 8-year planning cycle.
The key benchmark for tracking RHNA progress is issued building permits. The APR must be submitted to HCD and the Governor’s Office of Land Use and Climate Innovation (“LCI”) on or before April 1 of each year using the forms and tables specified by HCD. The APR provides information for the previous calendar year. (Gov. Code § 65400.) Community Development Department staff has prepared the 2025 Housing Element Annual Progress Report (“2025 APR”) for the City Council’s consideration for authorization to submit such report to HCD.
Assembly Bill 130 (“AB 130”) was signed into law and became effective on June 30, 2025. AB 130 amends Health and Safety Code (“HSC”) § 17974.1 to require that each city or county perform an annual inspection of every homeless shelter within its jurisdiction to ensure compliance with the law, regardless of the funding sources of the shelter.
As with the APR, each city or county is required to report its findings in an annual report submitted to HCD (and its Business, Consumer Services, and Housing Agency) by April 1 using forms specified by HCD. (See Attachment 2.) Reports are required to be submitted to HCD even if the city or county did not receive any homeless shelter complaints.
Laguna Beach has two homeless shelters within our jurisdiction – the Bridge Shelter on South Coast Highway and the Alternative Sleeping Location (ASL) in Laguna Canyon. Both are identified as having 30 beds apiece, and both are operated by the Friendship Shelter, Inc. City staff has gathered the information 2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
required for 2025 Homeless Shelter Inspection Report (“2025 HSIR”) for both facilities, as discussed further below, and is seeking City Council authorization to submit the 2025 HSIR to HCD.
DISCUSSION
A. 2025 Annual Progress Report
HCD requires the City to provide certain information in the City’s annual progress reports. Included as Attachment 1 is a PDF version of HCD’s excel template form for annual progress reports with the City’s required information populated by City staff. Below is an overview of the information required and page citations to where the City’s information can be found:
Table Content Attachment 1,
Page Number
A Housing Development Applications Submitted p. 5-6
A2 Annual Building Activity Report Summary – New Construction, Entitled, Permits, and Completed Units
p. 7-10
B Regional Housing Needs Allocation Program – Permitted Units Issued by Affordability
p. 11
C Sites Identified or Rezoned to Accommodate Shortfall Housing Need p. 12 D Program Implementation Status Pursuant to Government Code Section 65583
p. 13-27
E Commercial Development Bonus Approved Pursuant to Government Code Section 65915.7
p. 28
F Units Rehabilitated, Preserved, and Acquired for Alternative Adequate Sites Pursuant to Government Code Section 65583.1(c)
p. 29
F2 Units Converted Pursuant to Government Code Section 65400.2 p. 30 G Locally Owned Lands Included in the Housing Element Sites Inventory, that have been sold, leased, or otherwise disposed of Pursuant to Government Code Section 65400.1
p. 31
H Locally Owned or Controlled Lands Declared Surplus Pursuant to Government Code Section 54221, or Identified as Excess Pursuant to Government Code Section 50569
p. 32
J Student Housing1 Development with a Density Bonus Approved Pursuant to Government Code Section 65915(b)(1)(F).
p. 33
K Tenant Preference Policy Adopted Pursuant to Government Code Section 7061
p. 34
L A list of all historic designations listed on the National Register of Historic Places, the California Register of Historic Resources, or a local register of historic places by the city or county in the past year, and the status of any housing development projects proposed for the new historic designations p. 35
1 According to HCD, student housing is considered group quarters and does not count as progress toward RHNA. 2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
Below is a more detailed explanation of Table A2 (Annual Building Activity Report Summary – New Construction, Entitled, Permits, and Completed Units), Table B (Regional Housing Needs Allocation Program – Permitted Units Issued by Affordability), and Table D (Program Implementation Status Pursuant to Government Code Section 65583):
Table A2 (Annual Building Activity Report Summary – New Construction, Entitled, Permits, and Completed Units):
In 2025, the City issued entitlements for 62 new housing units. The City also issued building permits for 100 new housing units to proceed with construction. Lastly, the City completed final inspections (communicating the same outcome as issuing a certificate of occupancy) for 62 new housing units. Notably, accessory dwelling units comprise the majority of the City’s new housing units. (See Figure 1 below.) Indeed, in 2025, the City issued building permits for 85 ADUs (compared with 97 ADUs in 2024 and 112 ADUs in 2023). Additionally, the City completed final inspections (communicating the same outcome as issuing a certificate of occupancy) for 51 ADUs (compared with 71 ADUs in 2024 and 39 ADUs in 2023). “Finaled” means final inspections were completed and the units are now ready for occupancy. “Applied” means a planning application that was filed as complete during that calendar year.
Figure 1. Year-Over-Year ADU Activity
2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
Table B (Regional Housing Needs Allocation Program – Permitted Units Issued by Affordability):
State law requires that jurisdictions provide adequate and properly zoned sites to accommodate the production of its fair share of the RHNA. The City’s 394 housing unit RHNA allocation for 2025 is divided into four income categories. (See Figure 2, below.)
Household Income
Category
City’s RHNA Allocation 2025 Units Issued Permits Total Units to Date Very-Low 118 0 0
Low 80 0 0
Moderate 79 0 0
Above-Moderate 117 100 440
Total 394 100 440
Note: this data includes all permitted units, including those that have yet to complete construction and pass their final inspections.
Figure 2. Progress Towards RHNA
As shown in Figure 2, the City permitted 440 above-moderate units during the current planning period (2021-2029), exceeding the City’s above-moderate share by 323 units. Of the 440 permitted units, to date 246 of those building permits have been finaled (communicating the same outcome as a certificate of occupancy). The City continues to work towards facilitating 277 affordable units (very low- to moderateincome) by the end of 2029. While the City is not responsible for building or constructing these units, it is committed to working toward programs that will help generate the allocated RHNA for very low- to moderate units.
Table D (Program Implementation Status Pursuant to Government Code Section 65583):
The City began program implementation prior to and in anticipation of HCD’s February 7, 2023, certification of the Housing Element. The year 2025 is the fourth reporting year for the 6th Cycle Housing Element (2021-2029).
Several programs in the City’s certified Housing Element contain specific metrics. Notable achievements in 2025 include:
• Preservation/Legalization. The City has issued final occupancy and legalized 21 ADUs between the beginning of the 6th Cycle (October 15, 2021) and December 31, 2025, including three units in 2025. This achievement helps satisfy Programs 5.2-8 and 5.2-11 that target legalizing 20 unpermitted residential units. The City has now exceeded the Housing Element goal of legalizing 20 units during the 6th Cycle planning period.
• Preservation/Rehabilitation. Program 5.2-11 includes continuing to provide the Senior Home Repair Program with a goal of assisting 20 senior households over 8 years. Since the program was approved in 2020, the Senior Home Repair Program has assisted 21 senior households, including three senior households in 2025, exceeding the established goal in the Housing Element. The program requires applicants to meet 2020 incomes limits for low-income households – $71,750 for a one-person household, $82,000 for a two-person household. 2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
• Required Programs. The most important programs are those deemed “required” which represents 5 of the 85 Housing Element programs. HCD identifies required programs as especially important to show progress in implementing the Housing Element. The required programs and their status are shown below. (See Figure 3, below.)
Program
Number Action Time Frame and Objectives
5.2-1a Required: Monitor and update the sites
inventory to assess its adequacy for meeting
the RHNA.
Annually, as a part of Housing Element
Annual Progress Reports.
5.2-1b Required: Expeditiously complete the review
of in-process development permit applications
that include affordable housing projects.
On December 9, 2025 the Related
Companies of California submitted for
construction of a three-story, 30,690-squarefoot residential building to include 29 affordable housing units and 1 manager’s
unit on Neighborhood Congregational
Church site at 340 St. Ann’s Drive. The City
is expediting the review of this application as
much as possible.
5.2-1c Required: Provide streamlined permit
processing of residential projects that include
affordable units, including the development of
housing for lower-income households,
including extremely low-income households
and households with special needs, persons
experiencing homelessness; farmworkers;
persons with disabilities, including
developmental; and elderly.
The City has developed a Design Review
Efficiency Ordinance to improve efficiency
within the Community Development
Department process. Among other changes,
the ordinance reduces the level of design
review required for various project types,
including a new design review exemption for
new primary dwelling units that meet certain
objective development standards. The
Planning Commission recommended City
Council adoption of the ordinance on March
18, 2026 and will now be scheduled for the
City Council’s review and potential
adoption.
5.2-1d Required: See Program 5 regarding ADUs. In 2025, the City issued building permits for 85 ADUs (compared with 97 ADUs in 2024
and 112 ADUs in 2023). Additionally, the
City completed final inspections
(communicating the same outcome as
issuing a certificate of occupancy) for 51
ADUs (compared with 71 ADUs in 2024 and
39 ADUs in 2023).
5.2-1e Required: Provide incentives for the
development of 100% affordable projects on
On December 9, 2025 the Related
Companies of California submitted for
2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
Program
Number Action Time Frame and Objectives
sites with institutional uses such as religious
institutions, hospitals, and schools, and Cityowned sites. Pursue rezoning of residentially zoned institutional uses for affordable projects,
including 340 St. Ann’s Drive.
construction of a three-story, 30,690-squarefoot residential building to include 29 affordable housing units and 1 manager’s
unit on Neighborhood Congregational
Church site at 340 St. Ann’s Drive. The City
is expediting the review of this application as
much as possible. The applicant has not
requested – nor does the application require
– a rezone.
Figure 3. Required Housing Element Programs
City staff is seeking City Council authorization to submit Attachment 1, the 2025 APR, to HCD.
B. Homeless Shelter Inspection Report (“HSIR”)
AB 130 adds HSC § 17974.1.5 to require a homeless shelter to display at the shelter, and provide notice during intake, information about occupant rights and process for reporting a complaint alleging a homeless shelter is substandard. AB 130 also amends HSC § 17974.5 to require a city to submit a report annually to the department and HCD by April 1 of each year with the following information:
1. The number of complaints received by the city/county, pursuant to HSC § 17920.3, including if the city/county did not receive any complaints;
2. Any pending uncorrected violations determined by the city/county, pursuant to HSC § 17974.1;
3. Any determinations by the city/county that conditions exist or existed that make or made the homeless shelter dangerous, hazardous, imminently detrimental to life or health, or otherwise render the homeless shelter unfit for human habitation;
4. A list of any emergency orders issued pursuant to paragraph (3) of subdivision (c) of HSC § 17974.1;
5. A list of any owners or operators who received three or more violations within any six-month period; and
6. Any corrected violations from the prior year.
If a city or county applies for state funding to support operations of the homeless shelter, the city or county shall disclose to the State any unresolved violations and the name of the homeless shelty owner or operator.
The State may thereby deem the owner or operator ineligible for state funding for shelter operations. The State must withhold State funding from the city or county that fails to comply with the above-mentioned reporting requirements or fails to correct a substandard violation.
Included as Attachment 2 is HCD’s template Homeless Shelter Inspection Report form for reference. Below is the information that the City gathered for purposes of populating HCD’s template Homeless Shelter Inspection Report. (See Figure 4, below.)
2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
Reporting Requirement 2025 Report Data
Complaints received by the city/county. 18
Pending uncorrected violations determined by the city/county. 0 Determinations by the city/county that conditions exist or existed that make or made the homeless shelter dangerous, hazardous, imminently detrimental to life or health, or otherwise render the homeless shelter unfit for human habitation. 0 List of any emergency orders issued. 0
List of any owners or operators who received three or more violations within any six-month period. 0
Any corrected violations from the prior year. 0
Figure 4. Required Homeless Shelter Inspection Reporting City staff is seeking City Council authorization to populate Attachment 2 with the above information to create the 2025 HSIR and to submit the 2025 HSIR to HCD.
FINANCIAL ANALYSIS
The recommended action has no financial impact to the budget.
ENVIRONMENTAL ANALYSIS
The recommended action consists of organizational or administrative activities of the City that will not result in a direct or indirect physical change in the environment and therefore does not constitute a “project” within the meaning of the California Environmental Quality Act. (Public Resources Code Section 21065; 14 CCR Section 15378(b)(5).) Here, the recommended action of submitting the 2025 APR to HCD is an administrative action that does not make any physical change to the environment. Alternatively, the recommended action is exempt under CEQA Guidelines Section 15061(b)(3) because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. Here, the recommended action of submitting the 2025 APR to HCD is an administrative action that does not make any physical change to the environment and it can be seen with certainty that there is no possibility that the activity may have a significant effect on the environment. Upon taking the recommended action, City staff will cause to be filed within five calendar days a notice of exemption with the County and State Clearinghouse.
ATTACHMENTS
1. 2025 Housing Element Annual Progress Report (Pgs. 8-42)
2. 2025 Homeless Shelter Annual Report (Pgs. 43-44)
Submitted By: Matthew Schneider Approved: .David A Kiff Matthew Schneider, Director of
Community Development
Dave Kiff, City Manager
2025 HOUSING ELEMENT ANNUAL PROGRESS REPORT AND 2025 HOMELESS SHELTER
INSPECTION REPORT
March 24, 2026
Report Prepared By: Coordinated With:
Shaveta Sharma, Senior Planner Jane Abzug, Assistant City Attorney Anthony Viera, Deputy Director of Community
Development