to the coast are disproportionately white, more affluent, and older than those who live farther inland.36
Given hotel developers predominantly pursue higher-cost and luxury hotels, including in many cases where such higher-cost offerings take the place of existing lower-cost options along the coast, it is becoming increasingly important to focus on protecting and providing lower-cost overnight accommodations in the coastal zone as required by the Coastal Act and LCPs. Absent an adequate number and type of lower-cost lodging facilities, a large segment of the population will be effectively excluded from overnight stays at the coast. To this point, “financial reasons” was listed as the number one barrier to staying overnight at the coast, as identified by respondents to a State Coastal Conservancy-commissioned survey in 2017.37 By forcing this more limited means economic group to lodging out of the coastal zone (or forcing them to stay at home), there is an adverse impact on the general public’s ability to access the beach and coastal recreational areas. Such trends have thus made it more difficult for visitors of more limited means to access the coast; with many of these visitors traveling from fairly far inland locations where they cannot easily make the trip to the coast and back home again in a single day. Therefore, by protecting and providing lower-cost lodging for the price sensitive visitor as is mandated by the Coastal Act, the Commission can help to remove barriers and to increase access to a segment of the population facing inequities when visiting the coast. This in turn enhances access to our collective public coastal commons, helping to ensure true access for all.
Appeal Contentions
The appeals contend that the City-approved project raises a series of questions regarding consistency with the above-cited Coastal Act and LCP provisions that require and protect lower-cost visitor accommodations. Specifically, they contend that the approved project includes lower-cost room rates solely for eligible “heroes” (i.e., active military personnel, nurses, and frontline workers) but that the eligibility and room rates are not specified in the CDP but rather would be worked out later. The appeals further contend that the lower-cost rooms are not targeted to the general public (which is the actual LCP requirement) and that the project’s mitigation fee methodologies appear to significantly underestimate the amount of required mitigation fees. In short, the appeals contend that the City’s CDP approval does not adequately provide for lower-cost accommodations nor follow the specific prescriptions for same as laid out in the LCP.
See Exhibit 5 for the full appeal documents.
Analysis
As noted, the Pacific Grove LCP is quite specific as to lower-cost accommodation requirements. The first step in the analysis is to identify the minimum number of required lower-cost accommodation units so as to identify the minimum threshold for meeting LCP tests, all the while recognizing that the minimum threshold is just that, a minimum, and the actual LCP requirement is to maximize the number of such units (see 36 Coastal Access Equity and the Implementation of the California Coastal Act, Reineman, et al., (2016) Stanford Environmental Law Review Journal, v. 36. Pages 96-98. 37 Explore the Coast Overnight- An Assessment of Lower Cost Accommodations, published by State Coastal Conservancy on January 8, 2019.
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IP Section 23.90.220(c)(6)). Such analysis requires an evaluation of the type of units proposed, and whether they are low, medium, or high cost. The Commission has used a variety of methodologies for this purpose, and here the LCP incorporates a version of one of those methodologies, focusing on the average of all Pacific Grove area hotel and motel unit rates during peak summer times that are below the statewide average daily unit rate to determine the lower cost threshold. Here, the statewide average daily unit rate for July/August 2023 (the most recent data on the issue) was about $200. There were only six hotels and motels in the Pacific Grove area that have July weekend rates below that amount, ranging from a low of $157 to a high of $199, with an average of $184. Thus, based on the LCP’s specific methodology, the current lower cost threshold is no more than $184 per night for a standard double-occupancy economy hotel room (and, conversely, given that the LCP identifies higher cost as 120% of the statewide average daily unit rate, the current higher cost threshold is $240 per night).
In this case, the Applicant’s lower-cost analysis (prepared in 2020) identifies all 225 hotel units (that range in size from 420 square feet for standard queen or king rooms to 685 to 800 square feet for suites) as higher-cost, with a proposed rate of between $250 and $400 per night.38 Thus, the LCP at a minimum would require the Applicant to provide at least 56.25 lower cost units.
39 However, the Applicant’s analysis concludes
that it is not feasible to provide any of the required 56.25 rooms as lower-cost, whether onsite as part of the proposed project or as part of some other project completed by the Applicant within the City.40 The analysis reviewed the financial feasibility of the project under then-current economic assumptions (again, in 2020), employing a $400/room/night rate for 104 of the 225 rooms and $250/room/night rate for the remaining 121 of the 225 rooms. With those assumptions, along with information about vacancy rates and other operating revenues, the Applicant’s analysis concluded that the hotel would have an annual surplus of roughly $1.9 million which made the proposed project financially feasible. However, with 56 of the project’s rooms at a lower cost rate of $117/room/night, “on-site mitigation would make the ATC Project financially infeasible” due to a “financial gap of approximately $9 million.”41 In lieu of providing the LCP-required lower cost rooms on site, the Applicant proposed to provide the City a mitigation fee that the City could use for development of lower-cost overnight accommodations elsewhere, where the Applicant based their proposed fee on a cost estimate of $32,000 to develop each such unit, or a total mitigation fee of $1.8 million (i.e., 56.25 x $32,000 = $1,800,000). However, during the City Council approval hearing, and in response to Council questions regarding the preference for on-site accommodations rather than an in-lieu fee, the Applicant informed the City that it was in 38 “Lower-Cost Overnight Accommodation Impacts and Mitigation Analysis for the American Tin Cannery Project”.
39 225 high cost rooms x 25% = 56.25 rooms must be provided at lower-cost. 40 The LCP requires any such off-site and/or compensatory units developed from mitigation fees to be provided within City limits.
41 The analysis uses a lower-cost average daily rate (ADR) of $117, based on the ADR for economy class hotels in the Pacific Grove market area (including Pacific Grove, Pebble Beach, Carmel-by-the-Sea, Carmel Valley, and Monterey) back in 2020 (when the statewide average daily room rate was about $173), which would appear as reason for the difference in identified thresholds.
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fact feasible to provide lower-cost units on-site, and at that time proposed the ‘Heroes’ program. This program would provide lower-cost accommodations to nurses, firefighters, and police officers. The City Council ultimately approved this program, with the details regarding room cost, the mechanics of how one qualifies to be a ‘hero’, and other program elements to worked out at a later date with the Applicant and City staff.
The City’s approval raises a series of questions and problems in terms of LCP conformance. First, the Applicant’s feasibility analysis raises questions as to its assumptions and utility, including because at a basic level the Applicant appeared to disregard its ultimately conclusion that any on-site lower-cost units were infeasible when it proposed the Heroes program. Clearly, some form of lower-cost accommodations were actually feasible. And second, some of the assumptions made raise questions about their validity. All development costs used in the analysis were provided by the Applicant and the analysis states that some of the information provided deviated substantially from industry norms and required reconciliation.42 The analysis also used fairly low room rates for its estimates of revenues from the higher cost rooms as compared to other higher end offerings nearby on the Monterey Peninsula, estimating a per room cost at this site of only $250 per night, which is 60-80% less than nearby higher end offerings,
43 and only $10 more than what the LCP would define as moderate cost. In addition, it applied a lower cost room rate of $117/room/night when the LCP defined lower cost threshold was actually higher (and is $184/room/night today). By doing so, it appears to significantly underestimate potential revenues, which skews the analysis toward less feasibility for lower cost on-site rooms. Moreover, the analysis did not identify a mix of on-site and off-site room options, but rather simply evaluated two mitigation scenarios. The first scenario included reducing the total number of high cost rooms (specifically, the rooms that would be priced at $250/room/night) from 225 to 169 rooms, and then pricing 56 rooms at a lower-cost rate of $117/room/night, and the second scenario analyzed the feasibility of providing the above-described in-lieu fee for those 56 rooms instead of making them lower cost. The analysis did not include any evaluation of an off-site option, and it substantially deviated from the way in which the Commission typically calculates in-lieu fees in such a circumstance. While the Commission has used various metrics over the years for this calculation, in recent years it has used $100,000 (in 2015 dollars) as a base construction cost estimate for an offsite lower cost unit, and has updated that number yearly using the Turner Building Cost estimate (in 2023, this amount is about $145,000).
44 However, the Commission has
made clear that even this metric isn’t a perfect proxy, including because it can 42 As stated on page 19 of the report: “All development cost assumptions for the ATC Project were provided by the Developer. However, EPS reviewed these cost assumptions against standard per unit factors typical for hotel projects of this nature, and consulted with the Developer to reconcile any assumptions that appeared to deviate substantially from industry norms.” 43 For example, the least expensive room for a one-night stay on a Saturday in July 2024 at other nearby higher end hotels ranges from about $700 to over $1,300 (starting at $699 for the Plaza Hotel, $726 at the Intercontinental, $995 at the Spanish Bay Inn, $1,145 at the Pebble Beach Lodge, and $1,345 at the Casa Palmero Inn).
44 The Turner Building Cost Estimate is an industry standard that is used widely by federal and state governments to measure costs in the nonresidential building construction market in the United States:
https://www.turnerconstruction.com/cost-index.
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significantly undercount the amount of money it takes to construct an actual lower-cost unit.
45 But, for comparison purposes, using this metric would result in a total in-lieu fee of over $8 million,46 clearly well above the Applicant’s identified $1.8 million. This latter number was calculated based on the difference between what it would cost to construct a lower-cost unit off-site versus a ‘break even’ revenue stream. In other words, the ‘subsidy’ per unit, meaning that the developer would need a subsidy of $32,000 for each off-site lower-cost unit, and this difference is what the in-lieu fee was based. The Commission is not aware of using this financial/analytic approach in past projects, and it certainly isn’t recognized in the LCP.
A perhaps more analytically appropriate in-lieu fee would not be based hypothetical industry standards, but rather would use the site-specific assumptions provided in the Applicant’s feasibility analysis of what it would take to build a lower-cost unit in Pacific Grove. And in fact, the analysis included a series of metrics to estimate this cost, including the size of a typical lower-cost unit (423 square feet, inclusive of needed common spaces such as a lobby and hallways), 1 parking space per unit (at $33,095 per space in a structured lot, or taking up about 325 square feet of per space at $335/square foot), land costs of $6 million per acre (where an estimated 0.72 acres would be needed for a 47-unit lower-cost hotel), plus a 10% administration fee. When applying these data points and assumptions, the cost to build a lower-cost unit in Pacific Grove would actually be roughly $464,000 per unit based on the study’s numbers. At
56.25 units, this fee would equate to over $26 million. Since this in lieu fee amount is based on more accurate and precise assumptions, including in terms of including land costs and related measures necessary for an actual project to be realized, it clearly represents a more accurate manner in which to assess an off-site in-lieu fee. And the fee ultimately proposed by the Applicant and applied by the City, $1.8 million, is multiple orders of magnitude less than such estimate, some 15 times less.
And lastly, the City’s approval of the ‘Heroes’ program (that would provide reduced cost rooms to nurses, firefighters, and police officers), while well-intentioned, raises its own LCP consistency problems. First, the LCP does not allow using this type of method to identify those who would be eligible for lower cost rooms (see IP Section
23.90.220(c)(7)). Second, none of the ‘nuts and bolts’ in terms of actual implementation, including room rates, eligibility, or other mechanics were actually specified in the City’s approval. And third, the overall intention behind the requirement for lower cost rooms is so that the general public is able to make use of the rooms, especially so that those with more limited means are not priced out of overnight rooms in the coastal zone altogether, and a ‘Heroes’ program of this type does not achieve that objective, even if it were allowable by the LCP, which it is not.
In short, the City’s approval is not consistent with the LCP’s lower-cost visitor accommodation requirements. And for a project of this scope and magnitude in an area where it is so difficult to build new accommodations units of any kind, it is even more important to ensure such consistency so as to ensure that lower-cost units are indeed 45 See Commission findings on this topic in the Ocean Avenue Partners mixed-use project in CDP 5-22- 0799.
46 56.25 lower-cost units times $144,750 construction cost-per-unit equals $8,142,187.50.
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provided. For all of the above reasons, the City’s approval raises a substantial LCP conformance issue with respect to low-cost visitor-serving accommodations.
3. Public Views/Community Character
Applicable LCP and Coastal Act Provisions
The LCP is protective of public views and the visual qualities of Pacific Grove’s coastal areas as a resource of great public importance. The LCP does this through policies and standards that apply to new development more broadly, as well as specific provisions that apply to the ATC site. Among the broader directives, new development is required:
to protect public views to and along the shoreline, and to minimize landform alteration (LUP Policy SCE-1); to protect scenic resources and other coastal resources as a City priority (LUP LUD-1), and to be evaluated against development standards where all such standards are interpreted as maximums (such as for height) or minimums (such as for story stepbacks) that are required to be reduced (or increased) to protect and enhance such resources to the maximum extent feasible (LUP Policy LUD-1). For development located in designated scenic areas, which includes development sites like this one abutting and/or visible from Ocean View Boulevard, the LCP prohibits development from blocking or significantly adversely affecting significant public views (LUP Policy SCE-5), and requires visual analyses (e.g., renderings, story poles, etc.) to document a proposed development’s potential visual impact (IP Section
23.90.160(b)(1)(E)). For visitor-accommodation projects like this project “that fronts on and/or is visible from Ocean View Boulevard or the Ocean View Boulevard Recreational Trail, story stepbacks and building articulation shall be required to ensure that buildings and other structures do not dominate blue water ocean views, do not domineer over the public space, and do not appear as large flat planes” (IP Section 23.90.180(c)(4)(B)).
And finally, the LCP includes numeric site development standards specific to the ATC site, including specifying a maximum building height of 40 feet (with small appurtenances up to 8 feet higher so long as they do not significantly impact public views), and up to 90% site coverage only if additional public access amenities are provided above and beyond which the LCP would typically require (IP Section
23.90.180(c)(4)(G)). The LCP states:
LCP Policy SCE-1: Public views to and along the shoreline shall be protected and enhanced, and alteration of natural landforms shall be minimized.
LCP Policy SCE-5: The City will designate scenic areas of the Coastal Zone, including those areas described in Policy SCE-3, as areas having special scenic significance requiring the imposition of project-specific development standards designed to protect these scenic areas (refer to Figure 4, Scenic Areas).
Development standards for such special scenic significance areas shall include, but not be limited to, special siting and design criteria, including height and story limitations, bulk and scale limitations, screening and landscaping requirements, natural materials and color requirements, minimizing lighting that spills into nighttime public views, avoiding glares from windows and reflective surfaces, requirements to prepare landscaping plans utilizing drought tolerant and native plants that protect and enhance scenic resources; minimizing land coverage, grading, and structure height; and maximizing setbacks from adjacent open space areas. Clustering to maximize open space views may also be considered.
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Development within visually prominent settings, including those identified on Figure 4, and on all parcels that abut Ocean View Boulevard and Sunset Drive, shall be sited and designed to avoid blocking or having a significant adverse impact on significant public views, including by situating buildings, access roads, and related development in a manner and configuration that maximizes public viewshed protection, and through such measures as height and story limitations, and bulk and scale limitations. Clustering development to maximize open space views may also be considered.
LUP Policy LUD-1 (in relevant part): Protection of sensitive habitats, natural landforms, scenic resources, and other coastal resources is a priority in all City actions and decisions, and all development standards (including with respect to height, setback, density, lot coverage, etc.) shall be interpreted as maximums (or minimums) that shall be reduced (or increased) so as to protect and enhance such resources to the maximum extent feasible. Development shall only be authorized when the proposed use is allowed per the applicable land use designation, and when it meets all applicable Local Coastal Program policies and standards…
LUP Policy DES-3: The height limit for commercial development in Land Use Plan Areas I and III will vary, but in no case shall structures be more than 40 feet high. Minor exceptions to such height limit may be allowed for mechanical appurtenances that do not impact public views. Detached commercial signs shall be of a size, location, and appearance such that they do not detract from the area’s scenic qualities and cause visual clutter and blight.
IP Section 23.90.160(b)(1)(E): Applications for Development in Scenic Areas.
The following documentation and requirements shall be provided for all CDP applications within scenic areas, including those mapped in LUP Figure 4; all development on, seaward, or visible from Ocean View Boulevard, Sunset Drive, and the pedestrian recreational trails seaward of these roads; and any other development that may adversely impact public views: (1) Site-Specific Visual Analysis. At a minimum, the visual analysis shall include the following: … (E) Any other information deemed necessary to determine the visual impact of the proposed project, including but not limited to analysis of the heights of existing buildings within 150 feet of the proposed structure; story poles and netting showing proposed ridgelines; and visual simulations to help identify potential visual impacts.
IP Section 23.90.180(c)(4)(A)&(B): Visitor-Serving, Visitor-Accommodation and Sunset Service Commercial Design Standards. In addition to all other applicable LCP policies, the following design standards for development within the visitorserving, visitor-accommodation and sunset service commercial LUP land use designations shall apply:
(A) Coverage. Building and other site coverages shall be limited to the degree necessary to maintain public views, maintain adequate open space to preserve small-scale visual landscapes, maintain water quality (including by limiting A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
impervious surfaces), and maintain community character, including through requirements for compact design, pervious materials, and maximized landscaping and open space. In no case shall site coverage exceed 90 percent of total lot area. To the extent possible, any space remaining uncovered should be accumulated to maximize positive visual impacts and usability. (B) Heights and Articulation. Building and other structure heights shall be limited to the degree necessary to maintain public views, maintain pedestrian scale, and maintain community character. In no case shall building and other structures exceed 40 feet as measured from existing grade, and all such heights shall be reduced as necessary to ensure to the maximum extent feasible that existing blue water views from public vantage points are predominantly maintained. For new development that fronts on and/or is visible from Ocean View Boulevard or the Ocean View Boulevard Recreational Trail, story stepbacks and building articulation shall be required to ensure that buildings and other structures do not dominate blue water ocean views, do not domineer over the public space, and do not appear as large flat planes.
IP Section 23.90.180(c)(4)(G)(i)&(ii) (in relevant part): (G) American Tin Cannery Site. … [T]he following additional design standards apply to new development at the American Tin Cannery site comprised of Assessor’s Parcel Numbers 006-231-001, 006-234-004, 006-234-005, and the portion of Sloat Avenue between Eardley Avenue and Dewey Avenue (C-V-ATC zoning district):
(i) Coverage. Site coverage may only be allowed up to 90 percent of the total site area if the project includes consistent public amenities that enhance public access (e.g., restrooms, bicycle racks, seating areas, sidewalk and roadway access improvements on and off site, etc.) beyond that which is required by the LCP for compliance with other requirements. Otherwise, site coverage may be decreased if substantial public coastal access amenities are not incorporated into the project. (ii) Minor exceptions to height limits may be allowed for mechanical appurtenances up to an additional eight feet; provided, that no public views are significantly impacted and the equipment is appropriately screened.
In addition, since Coastal Act public access provisions are also relevant in appeals like this, Section 30251’s protection of public views as a form of public access also applies.
Section 30251 states:
Section 30251: The scenic and visual qualities of coastal areas shall be considered and protected as a resource of public importance. Permitted development shall be sited and designed to protect views to and along the ocean and scenic coastal areas, to minimize the alteration of natural land forms, to be visually compatible with the character of surrounding areas, and, where feasible, to restore and enhance visual quality in visually degraded areas. New development in highly scenic areas such as those designated in the California Coastline Preservation and Recreation Plan prepared by the Department of Parks and Recreation and by local government shall be subordinate to the character of its setting.
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Appeal Contentions
The appeals contend that the approved project oversubscribes the site with development that will degrade public views and will not maintain community character and compatibility, especially given that this site is a prime, highly visible location in the City near many visitor destinations. The appeals also contend that the City failed to require any onsite form of visual assessment (e.g., story poles and netting, balloons, etc.) to approximate the project’s bulk, height, and scale, and thus it is not possible to assess the impacts the approved development will have on public views in this highly scenic area of the City’s waterfront. The appeals overall contend that the project is too large for the site and doesn’t adequately meet the LCP’s provisions for development in scenic, prominent locales like this one. See Exhibit 5 for the full appeal documents.
Analysis
The approved development would cover an area of roughly 6 acres, rise to 40 feet in height, and total some roughly 350,000 square feet of floor area. Based on this size, it would be one of the largest developments in the Monterey Peninsula, and larger than the three largest structures in the Monterey/Pacific Grove communities combined. 47 And
while the approved design does include articulation to break up the perceived mass and scale of the project when viewed from Ocean View Boulevard, particularly when compared with the existing ATC structures which are industrial-type facades that encroach right up to Ocean View Boulevard, and visual renderings suggest only limited blockage of any existing public blue water views, the project also considerably increases the amount of development at the site overall. The project includes substantial hotel development on what is presently a surface parking lot, as well as on what is currently Sloat Avenue. This public street currently bisects the inland and seaward portions of the ATC site, thereby separating structures on both sides. The City’s approval allows for hotel development in this area, and thus this natural articulation is lost, as is its ability to help limit perceived massing in public views. And finally, and as discussed in more detail in the Public Access section, the project doesn’t appear to provide the type of public access amenities that are required of a project at this site to reach the LCP’s maximum 90% site coverage. Many of the amenities appear more geared to hotel guests than to the general public, and certain public access impacts related to the loss of public parking are unmitigated. Thus, it doesn’t appear that the finding to provide for the site’s coverage can be met.
All of this is to say that a structure of this size and scope clearly raises questions as to whether it meets the LCP’s specific prescriptions for development in this area, and whether it meets the Coastal Act’s public view access protection provisions. And this is only compounded by the fact that the site is located in a visually prominent spot kittycorner to the immensely popular Monterey Bay Aquarium, the Monterey Bay Coastal Recreation Trail, and right near the City’s border with Monterey. It thus serves as a 47 The adjacent Monterey Bay Aquarium occupies approximately 2.5 acres and is some 30 feet height, just next to it the Intercontinental Hotel occupies about 1 acre and is 46 feet in height, and just upcoast the Monterey Plaza Hotel occupies some 2 acres at 47 feet in height.
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‘gateway’ location to the City, and highlights the importance of ensuring its visual compatibility.
Finally, it should be noted that many Appellants have raised concern about the project’s lack of story poles and reliance on visual simulations to guide decision-making. As part of the City’s review, the City’s Building Official found that placing story poles to document structure height would be a safety hazard given strong winds and adjacent development. The Appellants argue the LCP requires story poles in order to make affirmative findings regarding a project’s consistency with the LCP as it ensures an understanding based on physical objective markers, and that visual simulations are an imperfect substitute. While the Appellants raise some valid points, it is inaccurate to state that the LCP affirmatively requires story poles. Rather, the LCP requires “any other information deemed necessary to determine the visual impact of the proposed project”, and lists story poles and renderings as types of tools to determine visual impact. In sum, while it would appear that some form of story poles, balloons, or other similar tools could have been employed (including on non-windy days, etc.), the lack of same does not de facto render the project LCP inconsistent and thus unapprovable as the Appellants suggest.
In any event, the sheer size and scale of this project, including the way it appears to potentially oversubscribe the site in terms of mass, and its impacts on views and the coastal viewshed all raise questions as to its conformity with applicable Coastal Act and LCP public view and community character provisions. When understood in relation to the site’s prominent location as a critical “gateway” site into the City, such issues clearly warrant Commission review. In sum, the project raises a substantial issue with respect to public views and community character compatibility.
4. Public Access
Applicable Coastal Act and LCP Provisions
The Commission’s appellate review lens includes the Coastal Act’s public access policies as well as the access provisions of the LCP. The Coastal Act grants a high priority to public recreational access uses and activities to and along the coast. The Act protects and encourages lower-cost visitor and recreational facilities where feasible and states a preference for developments providing public recreational opportunities. In addition, the Coastal Act requires that oceanfront land and upland areas suitable for recreational use be protected for recreational uses. In particular:
Section 30210: In carrying out the requirement of Section 4 of Article X of the California Constitution, maximum access, which shall be conspicuously posted, and recreational opportunities shall be provided for all the people consistent with public safety needs and the need to protect public rights, rights of private property owners, and natural resource areas from overuse.
Section 30211: Development shall not interfere with the public's right of access to the sea where acquired through use or legislative authorization… Section 30212(a): Public access from the nearest public roadway to the shoreline and along the coast shall be provided in new development projects … A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
Section 30212.5: Wherever appropriate and feasible, public facilities, including parking areas or facilities, shall be distributed throughout an area so as to mitigate against the impacts, social and otherwise, of overcrowding or overuse by the public of any single area.
Section 30213: Lower cost visitor and recreational facilities shall be protected, encouraged, and, where feasible, provided. Developments providing public recreational opportunities are preferred. …
Section 30221: Oceanfront land suitable for recreational use shall be protected for recreational use and development unless present and foreseeable future demand for public or commercial recreational activities that could be accommodated on the property is already adequately provided for in the area.
Section 30222: The use of private lands suitable for visitor-serving commercial recreational facilities designed to enhance public opportunities for coastal recreation shall have priority over private residential, general industrial, or general commercial development, but not over agriculture or coastal-dependent industry.
Section 30223: Upland areas necessary to support coastal recreational uses shall be reserved for such uses, where feasible.
Section 30240(b): Development in areas adjacent to…parks and recreation areas shall be sited and designed to prevent impacts which would significantly degrade those areas, and shall be compatible with the continuance of those…recreation areas.
Section 30210 of the Coastal Act requires the Commission to maximize public recreational access opportunities. Section 30211 prohibits development from interfering with the public’s right of access. In approving new development, Section 30212 requires new development to provide access from the nearest public roadway to the shoreline and along the coast, save certain limited exceptions, such as existing adequate nearby access. Sections 30213, 30221, 30222, and 30223 prioritize visitor-serving and recreational uses on oceanfront land over other types of development, particularly uses that provide lower-cost opportunities, and also require that parking be provided in a manner that mitigates overcrowding of any particular area. Section 30240 protects against impacts to adjacent park areas, such as the Pacific Grove recreational trail along Ocean View Boulevard at the site. And finally, the Coastal Act Section 30210 direction to maximize public recreational access opportunities represents a different threshold than to simply provide or protect such access opportunities and is fundamentally different from other like provisions in this respect. Put another way, it is not enough to simply provide access to and along the coast, and not enough to simply protect access, rather such access must also be maximized. This terminology distinguishes the Coastal Act in certain respects and provides fundamental direction with respect to projects along the California coast that raise public access issues, especially where a private developer is proposing to use public land for private purposes, as is the case here.
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And the LCP includes a similar set of goals, objectives, policies, and implementing standards designed to protect, maintain, and improve a multitude of public access and recreational opportunities along the Pacific Grove shoreline and its parks and trails. For example, the LUP includes policies encouraging ‘complete streets’ that are safe for cars, bikes, pedestrians, and transit, maintaining a continuous bike path along the City’s shoreline, provisions requiring bike racks, maintenance of existing public parking areas, etc. The LUP also encourages enhanced visitor and public access, circulation, and parking at the ATC site, and requires that any loss of public parking that may adversely impact public access be relocated or otherwise mitigated. The IP requires that any application for development that has the potential to impact public access, either temporarily or permanently, must submit a Public Access Management Plan that identifies existing access and recreational opportunities, analyzes impacts to such opportunities, and provides mitigation to reduce or offset those impacts. Finally, with respect to the project site specifically, IP Section 23.90.180(c)(4)(G)(i) only allows 90 percent coverage if the project provides public amenities over and above what the LCP would otherwise require.48 Specifically, the LCP states:
LUP Policy INF-22: New development in the Coastal Zone shall include adequate off-street parking to minimize the disruption of significant coastal access routes. All traffic impacts associated with new development shall be mitigated appropriately.
LUP Policy PRA-1 (in relevant part): The City will strive to provide safe and adequate access to and along the City’s shoreline and other points of public interest…
LUP Policy PRA-2: The City will enhance access to its shoreline, while maintaining the Coastal Zone’s unique character, by reducing the impact of automobiles. This shall be accomplished, in part, by encouraging use of public transit within the Coastal Zone, and by providing nonvehicular Coastal Zone access opportunities for bicycles and pedestrians. When considering a Coastal Development Permit application for any development that could reduce or degrade public parking opportunities near beach access points, shoreline trails, or parklands, including any changes in parking timing and availability, evaluate the potential impact on public coastal access, and ensure existing levels of public access are maintained, including through ensuring that alternative access opportunities, including bike lanes and parking, pedestrian trails, and relocated vehicular parking spaces, are provided so as to fully mitigate any potential negative impacts and maximize access opportunities. Any revenue from feebased parking programs within the Coastal Zone shall only be used to fund public access improvements within the Coastal Zone.
LUP Policy PRA-3: Any sign that could reduce public coastal access, including signs limiting public parking or restricting use of existing lateral and/or vertical accessways, shall require a Coastal Development Permit. Appropriate signing 48 Where such provision was made applicable to the whole of the ATC site via the City’s first amendment to the LCP in 2021 (LCP Amendment Number LCP-3-PGR-21-0038-1).
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should be considered for popular visitor destinations and access points in conjunction with other sign programs under coastal access and habitat protection policies. However, excessive signs and other visually intrusive landscape features shall be avoided. The City will develop a coordinated sign program for the City’s shoreline area to ensure consistency of information and presentation, and to ensure that such signs effectively integrate into the shoreline with the least amount of impact to public views.
LUP Policy PRA-5 (in relevant part): The City will also consider the following opportunities: a. Encourage enhanced visitor and public access, circulation and parking at the American Tin Cannery building and property… LUP Policy PRA-8 (in relevant part): Development with the potential to impact public access, whether during construction or after, shall develop a Public Access Management Plan designed to identify and limit impacts to public access.
Plans shall identify peak use times and measures to avoid disruption during those times, minimize road and trail closures, identify alternative access routes, and provide for public safety…
LUP Policy PRA-9: New development shall ensure that public access opportunities are maximized, including though offsetting any temporary (e.g., during construction) and potential permanent impacts to public access (including in terms of increased traffic leading to impacts to public access use of the City’s circulation system) appropriately and proportionally. Development shall provide for public access enhancements and improvements as much as possible, including in terms of providing public access use areas in private development projects (e.g., visitor serving development) as appropriate. Development that does not meet these requirements shall be denied.
LUP Policy PRA-11 (in relevant part): Lower cost visitor-serving facilities, including overnight accommodations and public recreational opportunities, shall be provided and encouraged...
LUP Policy INF-14: The City will seek to make “complete streets” improvements to the existing circulation system serving the Coastal Zone for expanded use by all users including pedestrians, bicyclists and transit passengers of all ages and abilities, as well as trucks, buses and automobiles.
LUP Policy INF-16: The City will require a construction phase traffic control plan for new development that has the potential to disrupt circulation on arterial or collector streets.
LUP Policy INF-22: New development in the Coastal Zone shall include adequate off-street parking to minimize the disruption of significant coastal access routes. All traffic impacts associated with new development shall be mitigated appropriately.
IP Section 23.90.180(c)(4)(G)(i) (in relevant part): (G) American Tin Cannery Site. … [T]he following additional design standards apply to new development at A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
the American Tin Cannery site comprised of Assessor’s Parcel Numbers 006- 231-001, 006-234-004, 006-234-005, and the portion of Sloat Avenue between Eardley Avenue and Dewey Avenue (C-V-ATC zoning district): (i) Coverage. Site coverage may only be allowed up to 90 percent of the total site area if the project includes consistent public amenities that enhance public access (e.g., restrooms, bicycle racks, seating areas, sidewalk and roadway access improvements on and off site, etc.) beyond that which is required by the LCP for compliance with other requirements. Otherwise, site coverage may be decreased if substantial public coastal access amenities are not incorporated into the project.
IP Section 23.90.220(b)(1): Applications for Development Potentially Affecting Public Access. The following documentation and requirements shall be provided for the following applications: (1) Paid Public Parking Program. The establishment of a paid public parking program or changes to an existing program (e.g., changes in hours, locations, rates, etc.) shall require a CDP. At a minimum, applications must include the following: (A) Identification of the location, hours, and rates of paid public parking. (B) Analysis of potential impacts of paid parking on coastal access; including the availability of free parking at other coastal locations, alternative access opportunities such as bike lanes and public transit. (C) Establishment of a dedicated fund where all parking fees will be held and utilized solely to improve and enhance coastal access and recreation opportunities.
IP Section 23.90.220(b)(3): Permanent Public Access Impacts. Development that has the potential to permanently impact coastal access, including in terms of limitations of use hours, limitations on particular recreational activities, or increased traffic leading to impacts to public access use of the city’s circulation system, shall require development of a public access management plan. At a minimum, the plan must include the following: (A) Identification of the locations, times, and types of all closures and/or limitations to existing public access and/or recreational opportunities. (B) Documentation regarding the necessity of any closures and/or limitations (e.g., avoid overuse, protect biological resources, maintain water quality, etc.). (C) Analysis of potential impacts to coastal access; including the availability of alternative access and recreation opportunities at other coastal locations. (D) Mitigation measures to avoid and/or offset impacts to public access, including providing additional and/or enhanced public access improvements in other locations and/or additional low-cost recreational opportunities. (E) Private development projects (e.g., visitor-serving development) shall provide for public access enhancements and improvements both on and off-site as much as possible.
Appeal Contentions
The appeals contend that the City-approved project does not provide adequate public access amenities, and that the amenities provided are largely geared to hotel guests and not the general public. The appeals further contend that the project reduces existing public access and amenities by allowing private use of portions of the Sloat Avenue and Ocean View Boulevard rights-of-way. The appeals also contend that the approved project will result in the loss of existing on-street public parking spaces along public A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
streets and that no mitigation was required for such loss, thereby adversely impacting the general public’s ability to access and recreate in this area. Finally, the appeals contend that traffic both during construction and post construction will impact the public’s ability to access this highly visited area of the coast. See Exhibit 5 for the full appeal documents.
Analysis
The Coastal Act and LCP both speak to maximizing public access and recreational opportunities, and the LCP also requires such amenities be provided at the ATC site above and beyond what the LCP would ordinarily require. In other words, the LCP recognizes the site’s particular importance for public access purposes and seeks to ensure that any project here makes public access amenities, needs, and spaces an integral part.
The City-approved project does not meet such requirements. While the project does include some public amenities, including access to a rooftop garden, interpretive signage, and a public restroom, these do appear to be more geared towards hotel guests than being reserved for public benefit, as the appeals suggest. In addition, the rooftop garden and the courtyards are intended to be areas where individuals simply walk from one end to the other and are not intended for individuals to occupy for longer periods of time (with tables, seating areas, etc.), reducing any potential utility. Further, both the garden and bathroom are accessed from the interior of the hotel facility itself, meaning that the public must traverse private space (including retail and restaurant space) where not only would such a configuration present psychological barriers to general public access, but it would also create a perceived pressure to purchase goods, or to only use such facilities with a purchase, all of which limits their public access utility.
Even with signage, the public rarely feels comfortable enough to access and use public areas so engrained within a private structure, thereby enforcing the perception that such uses are not open to the general public and reducing their public access usefulness in this regard.
In addition, the project includes elements that will actually reduce public access and amenities such as the conversion of roughly two-thirds of Sloat Avenue, or about 20,000 square feet, and a roughly 3,000 square-foot portion of the public sidewalk along Ocean View Boulevard, from public to private use. These rights-of-way and street areas currently provide significant public utility, including for general public use, access, parking, and public views across about the half-acre in question, and all of that would be lost through the project. The approved project would convert the entire portion of Sloat Avenue, including its travel lane, sidewalks, and parking, from public use to private hotel use (i.e., the hotel structure would be physically located in this space). And portions of the public sidewalk along Ocean View Boulevard would be used as an elevated walkway open for both public and private use. The City’s approval does not include any form of mitigation of this loss of public property. With such unmitigated impacts and with the limited utility of the project’s public access offerings, the requisite LCP findings cannot be met. In sum, the City’s CDP approval raises a substantial Coastal Act and LCP conformance issue regarding public access.
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5. Habitat Resources
Applicable LCP Provisions
The Pacific Grove coastal zone supports a wealth and diversity of environmentally sensitive habitats (ESHAs), biologically sensitive species, and significant marine resources. Many of these can be vulnerable to development activities, whether during construction or for the life of projects. The LCP includes a robust framework to prevent adverse impacts to such habitats and species, including those habitats located in offshore marine areas. Relevant LCP provisions include:
LUP Policy BIO-1: Environmentally Sensitive Habitat Areas, or “ESHAs,” are defined as any area in which plant or animal life or their habitats are either rare or especially valuable because of their special nature or role in an ecosystem and which could be easily disturbed or degraded by human activities and developments. In Pacific Grove these areas include, but are not limited to, dune, wetland, streams, coastal bluff, sandy and rocky beaches, intertidal and subtidal zones, tide pools, kelp forests, offshore reefs, rocks, and islets, and rookery areas.
LUP Policy BIO-3: Applications for development within and near Environmentally Sensitive Habitat Areas, including wetlands and streams, shall be accompanied by a habitat assessment prepared by a qualified biological and a botanical survey by a qualified expert prepared at the owner’s expense, prior to consideration of a project within the City. The habitat assessment and botanical survey shall, at a minimum, identify and confirm the extent of the Environmentally Sensitive Habitat Area, document any site constraints and the presence of sensitive species, recommend buffers and development setbacks and standards to protect the Environmentally Sensitive Habitat Area, recommend mitigation measures to address any allowable impacts, and include any other information and analyses necessary to understand potential Environmentally Sensitive Habitat Area impacts as well as measures necessary to protect the Environmentally Sensitive Habitat Area resource as required by the Local Coastal Program
LUP Policy BIO-7: The City will preserve its character-defining flora and fauna, such as rosy ice plant (Drosanthemum floribundum), Monterey pine, Monterey cypress, Coast Live Oak, Monarch butterfly, Harbor seal, Southern Sea Otter, Humpback and Gray Whale and Black Oystercatcher.
LUP Policy BIO-11: The City will implement seal pupping protection measures, including installation of split-rail fencing, installation of temporary “no climb” wood lattice fencing or other alternative that provides visual access, and educational signage if found necessary to prevent harm or harassment of harbor seals during the spring pupping season generally February through May, at various locations along the Pacific Grove shoreline east of Berwick Park and immediately adjacent to the Pacific Grove Recreation Trail. Impacts to public access from such measures shall be minimized. In addition, the City may use trained volunteer docents, including National Oceanic and Atmospheric Administration trained Bay Net volunteer docents when available, to educate and engage the public on the A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
activities of the seals, and to monitor and document all activities in the vicinity of the program, including any unauthorized human interruptions.
LUP Policy BIO-12: The City will protect Black Oystercatchers and their rocky intertidal habitat along the City’s shoreline. The City shall work in cooperation with the California Central Coast Black Oystercatcher Monitoring Project or its successor, the Pacific Grove Museum of Natural History, Monterey Audubon Society, and other appropriate entities and research efforts, to implement identified conservation measures necessary to carry out this policy. The California Central Coast Black Oystercatcher Monitoring Project, which monitors and assesses Black Oystercatcher populations and breeding success, is developing specific conservation measures, and will coordinate with the City, California Coastal National Monument/BLM, and California Department of Parks and Recreation at Asilomar as appropriate to their respective jurisdictional authority. Protective measures shall include an education program, using interpretive signage, outreach material, and docents to promote public understanding of the sensitive nature of the Black Oystercatcher habitat and the importance of not disturbing breeding pairs. The California Central Coast Black Oystercatcher Monitoring Project coordinators or their designees may seek permission from the appropriate landowner (e.g., City of Pacific Grove, California State Parks, Bureau of Land Management, etc.) to apply for a Coastal Development Permit on the landowners behalf to place temporary signage, physical barriers, and wildlife monitoring cameras where appropriate, at vulnerable nesting areas during the breeding season (March into September) to help reduce disturbance. Impacts to public access from such measures shall be minimized.
LUP Policy MAR-5: Marine resources shall be maintained, enhanced, and where feasible, restored. Special protection shall be given to species and areas of special biological significance. Uses of the marine environment shall be carried out in a manner that will sustain the biological productivity of coastal waters and that will maintain healthy populations of all species of marine organisms adequate for long-term commercial, recreational, scientific, and educational purposes.
LUP Policy DES-6: New lighting fixtures shall be mounted at low elevations and fully shielded to direct lighting downward, and away from the shoreline. Lighting along walkways should be mounted on low bollards or ground buttons. Lighting shall be focused on targeted use areas, and floodlighting shall be prohibited.
Exterior lighting fixtures should complement the architectural style of structures.
Lighting shall be limited to that necessary to provide for public safety, and shall be sited and designed to limit glares and light spill off-site.
Background
The project site is currently developed with several structures and parking lots and surrounded on three sides with similar urban development. Immediately across Ocean View Boulevard is rocky shore habitat, including tidepools (intertidal and subtidal areas), and small sandy beaches, along with Stanford University’s Hopkins Marine Station A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
complex. The marine environment here is part of the Monterey Bay National Marine Sanctuary (MBNMS) and the Lover’s Point-Julia Platt State Marine Reserve (SMR).
This shore habitat supports diverse marine bird life and marine mammals, including three nearby beaches that are important known pupping and haul out areas for the Pacific harbor seal (Phoca vitulina): Fisher Beach, which is located at the eastern/upcoast end of the Hopkins Marine Station adjacent to the Monterey Bay Aquarium and approximately 255 feet from the ATC site; West Beach, which is along the downcoast/western side of Hopkins, and approximately 400 feet from the site’s corner along Ocean View Boulevard and Dewey Avenue, and the Fifth Street Rookery, which is further west/downcoast and about 1,000 feet from the ATC site. Harbor seals regularly haul out on these beaches to rest and, in March and April, female harbor seals give birth on these beaches. Females bear one pup each year and may nurse it for four to six weeks before it is weaned, typically in the same location year after year,49 including where the mother will leave the pup on the beach while she forages for food in nearby waters.
Harbor seals are particularly vulnerable to human disturbance. Noise, light, and vibration can cause stress to harbor seals, which can result in injury, relocation, or abandonment of pups. Harbor seals are protected by the Marine Mammal Protection Act implemented by the National Marine Fisheries Service (NMFS, or NOAA Fisheries), which generally prohibits their ‘take’50 unless authorized via an Incidental Take Permit (ITP) issued by NMFS. Generally speaking, NMFS can authorize an ITP for certain activities that will result in unintentional, but not expected, take, such as for construction projects, scientific research, and energy/oil and gas projects. Since the offshore waters are part of the Monterey Bay National Marine Sanctuary, the Sanctuary also prohibits take in a similar fashion as NOAA Fisheries does, with a National Marine Sanctuary permit required to allow for such otherwise prohibited activity. In addition, the California Department of Fish and Wildlife (CDFW) prohibits all injury, damage, take, or possession of any living marine resource in State Marine Reserves (as applies to all of offshore areas in the ATC vicinity) except in relation to scientific, research, or restoration purposes.
Offshore of the project site, the larger rocks above high tide and wave spray support roosting birds as well as the black oystercatcher (Haematopus bachmani), which is present year-round and nests on these rocks. Nesting pairs have been observed along the rocky shoreline adjacent to Hopkins Marine Station, approximately 500 feet from the ATC project site.51 The black oystercatcher is federally listed as a “Species of Conservation Concern” and CDFW placed black oystercatchers on a high priority status 49 Females have high site fidelity in that they will return to the same spot on the same beach or rocky outcrop year after year to give birth to and raise their pups. 50 Which is defined similar to the Endangered Species Act in terms of hunting, capturing, harassing, killing, or attempting same.
51 According to the project’s EIR, in 2016, seven pairs of black oystercatchers were documented to nest along the Pacific Grove shoreline (pg. 185 of FEIR). And four nests were spotted in close proximity to the Hopkins Marine Station in 2023 per the Monterey Audubon’s Black Oystercatcher Reproductive Success Report. Black oystercatcher pairs are monogamous, nest March – September, and spend several months teaching their young to forage for invertebrates.
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for further investigation and conservation. Black oystercatchers are a species of high conservation concern due to their small population size, low reproductive success, and dependence on habitats that are highly vulnerable to human disturbance. If parents are driven away from the nest by any disturbance, such as noise, the eggs or chicks are left vulnerable to gulls and other predators. The young require four to five years to reach full maturity and begin nesting.
See Exhibit 1 for a map of the offshore beaches located near the project site.
Appeal Contentions
The appeals contend that the approved project does not adequately protect harbor seal habitat or black oystercatcher nesting territory located offshore near the project site.
Specifically, the appeals contend that construction noise, including demolition and excavation, could adversely affect these species, especially during pupping and nesting seasons in violation of the LCP’s resource protection policies. The appeals also contend that the City-approved mitigation measures are not adequate to protect these species during construction activities and that the approved mitigations are vague, are reactive and not proactive (i.e., mitigation is implemented after disturbance is noted), and do not contain adequate standards for work stoppage, work recommencement, or noise reduction effectiveness. One appeal also contends that the project’s lighting will substantially increase the nighttime luminescence beyond the exterior of the buildings/site, which could negatively impact birds in the surrounding area. See Exhibit 5 for the full appeal documents.
Analysis
As noted, the Pacific Grove LCP includes a suite of provisions to protect habitats broadly, as well as black oystercatchers and harbor seals specifically. The LCP requires, mirroring Coastal Act Section 30231, that marine resources be maintained and enhanced, with special protections afforded to areas with special biological significance.
The offshore area clearly meet this ‘special biological significance’ standard given its status as a National Marine Sanctuary and State Marine Reserve. The LCP also includes specific protections for harbor seals and black oystercatchers, including implementing measures to protect pupping, as well as to protect the rocky intertidal habitat for oystercatchers, both of which are character-defining fauna in Pacific Grove, and are also protected under relevant State and Federal law.
The project’s EIR recognized these resources and underwent an extensive review of potential impacts, finding that construction noise from the project site could result in impacts to offshore resources, and was the most potentially concerning aspect of the proposed project.52 The EIR walked through the science and literature on construction 52 The EIR also evaluated the impact of lights and windows on such resources, and found that, in conformance with LUP Policy DES-6, shielding, bird friendly windows, and other lighting downcasting techniques so as to reduce light spill would adequately protect against any adverse impacts, particularly when understood in relation to the surrounding urban context with the existing ATC site, residential development, and the Hopkins Marine Station all being existing light-emitting uses.
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noise impacts, finding that NMFS uses 90 decibels53 as the in-air threshold for when harbor seals exhibit behavioral disruption, with 100 decibels for other pinnipeds. 54 However, it did note that much of the literature is based on underwater sound, and thus while these above water thresholds are identified by the EIR as the ‘industry standard’ at this current time, more research was needed on this topic. This is particularly important since pregnant harbor seals are stationary for long periods of time and don’t have as much capacity for movement away from a disruptive noise source.
The EIR then quantified the construction activity for the purpose of estimating the potential for offshore noise impacts. The Applicant estimates that construction will take between 18-24 months, with the loudest potential for noise being during initial demolition and subterranean excavation. During this loudest phase and at Fisher Beach, which is the closest harbor seal location to the ATC site at 255 feet away, noise is expected to reach up to 81 decibels. It also estimated that ambient noise at Point Cabrillo, which is the seaward-most point of Hopkins Marine Station and in between Fisher Beach and West Beach, is currently 64 decibels. Thus, the EIR concluded that noise should not adversely affect marine mammals, including because it would be less than the NMFS-recommended 90 decibel, and because of the distance from the project site to area beaches, intervening structures and topography, and general existing noise from surrounding ocean conditions and urban development. That said, the EIR also found that harbor seals are “a unique receptor and marine mammal protection is a priority for the City” and thus recommended a series of mitigation measures that were included as part of the City’s approval. These measures included only allowing demolition, grading, and excavation (the loudest activities) to take place outside of harbor seal pupping season (i.e., no such work between February through June), and biological monitoring during “phases of construction that generate higher noise and vibration levels”, comprised of daily monitoring during demolition and excavation, and twice monthly during the remainder of the construction program. It also provided authority for the required on site monitor to stop work based on identified “activity or behavior identified by the monitor(s) indicative of unusual stress or threatening relocation”, with work to resume “only after noise levels are reduced and additional noise/disturbance protection measures are employed and tested in the field for effectiveness.”
The Commission’s Ecology group has reviewed project materials, relevant literature, and consulted with numerous local experts in the field of marine mammal and avian protection. With respect to potential black oystercatcher impacts, oystercatchers are especially sensitive to visual disturbance, and susceptible to disturbance from construction noise and vibration. And with respect to potential harbor seal impacts, the general consensus is that there isn’t a clear answer as to whether or not the project’s construction noise would or would not adversely impact harbor seals. As noted, the literature on such issues is evolving and imprecise, and thus it can’t for certain be said 53 For perspective, 90 decibels is roughly equivalent to a food blender at 3 feet away indoors, 100 decibels is equivalent to a jet flyover at 1,000 feet, and normal speech is about 60 decibels. 54 See NMFS’ ‘Marine Mammal Acoustic Thresholds’ listed here: https://www.fisheries.noaa.gov/westcoast/endangered-species-conservation/esa-section-7-consultation-tools-marine-mammals-west#marinemammal-acoustic-thresholds.
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that 90 decibels is the absolute threshold for acceptable noise impacts. Multiple harbor seal experts agreed that behavioral responses can occur at noise levels below 90 decibels. And given that construction noise is estimated to be close to this noise level, there remains the potential for adverse impacts. Therefore, the finding that the project shall protect and maintain marine habitats and species cannot be made with certainty.
Hence, at a minimum, there is a need for much more robust monitoring, specificity on actions that should be taken, and mitigation measures that should be applied to protect such species and their habitats. Put another way, while the City-approved monitoring program at a broad level is a good start, it lacks sufficient details to effectively carry out its objectives. For example, it doesn’t specify the actual triggers for work stoppage, including what would constitute harm and distress; it doesn’t specify/require that relevant resource agencies, including NMFS, CDFW, the Sanctuary, or the Commission would be notified of such stoppage (only the City and the Applicant would be notified); and it does not specify what would happen if construction activity couldn’t safety restart.
Altogether, the project raises some significant habitat concerns that have not been resolved though the City’s approval.
In sum, the City’s CDP approval raises a substantial LCP conformance issue regarding coastal habitat resources.
6. Historic Resources
Applicable LCP Provisions
The LCP includes provisions designed to identify, maintain, enhance, and protect historical resources throughout the City, including LUP directives for the City to implement various programs and efforts to protect historical resources, including by maintaining and updating an inventory of historic resources and engaging citizens and groups in historic preservation efforts. The LUP also requires redevelopment of structures of historical significance to retain the lines of original designs as much as possible and requires compliance with federal historical resource protection standards.
Finally, the IP requires that applications for development that may impact historical resources submit a Historic Resources Report that describes the potential resources on site, discusses potential impacts, describes how impacts may be minimized, and explores alternative designs and how they relate to existing historic resources. The LCP states:
LUP Policy CRS-4: The City will update the background information for all archaeological sites identified within the Coastal Zone to develop a current assessment of the resources’ potential historical significance and evaluate their vulnerability to climate change, including those sites recommended or determined to be eligible for listing in either the National Register of Historic Places or the California Register of Historic Resources; and conduct the further research needed in order to determine the present condition of each site and to make an assessment of their potential eligibility for listing on either register, and therefore, their potential historical importance.
LUP Policy CRS-7: Rehabilitation, reconstruction, remodeling, or exterior modification of existing structures with historic or architectural significance in the Pacific Grove Retreat, and other neighborhoods in the Coastal Zone, shall relate A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
to or retain the lines of the original design as much as possible and alterations shall provide evidence of substantial compliance to the Secretary of the Interior standards for historic resources.
LUP Policy CRS-8: Design review shall be required as part of the Coastal Development process in order to maintain historical continuity and visual harmony of new development within the Pacific Grove Retreat and other neighborhoods in the Coastal Zone.
LUP Policy CRS-9: In order to protect historic structures, unwarranted demolition shall be avoided by implementing standards for demolition.
LUP Policy CRS-10: The City will continue its ongoing programs of citizen involvement in carrying out its historic preservation policies and programs.
LUP Policy CRS-12 (in relevant part): Other historic or architecturally unique structures, including the Julia Morgan structures at Asilomar State Beach and Conference Grounds, shall be protected and maintained to the fullest extent possible…
LUP Policy CRS-13: The City will maintain and update the Historic Resources Inventory, with assistance from professional consultants and the Heritage Society of Pacific Grove, to provide a current description of the historic and visual character of the Pacific Grove Retreat and of the other historical neighborhoods in the Coastal Zone.
IP Section 23.90.200(b)(2)(A-C): Applications for Development Potentially Affecting Cultural Resources. The following documentation and requirements shall be provided for all CDP applications that may impact cultural resources:
…(2) Historic Resources Report. For new projects that include demolition or alterations to potential historical resources, a historical assessment report prepared by a qualified professional is required prior to approval of the project.
The lead author must meet the Secretary of the Interior’s professional qualifications standards (36 CFR Part 61) in history or architectural history. At a minimum, the historical assessment report shall include the following: (A) Detailed description of the historical resources at the project site. (B) Discussion of potential adverse impacts on historical resources from the project. (C) Recommended mitigation, minimization, and/or avoidance measures to protect historical resources, including description of alternative designs for the proposed project (if any are proposed) and how alternative designs relate to the historical resources on the site and alternative design impacts compare to those of the project.
Appeal Contentions
The appeals contend that several of the buildings that will be modified or demolished qualify as historic for listing under State and local historic resource inventories. The appeals further contend that the project was never referred to the City’s Historical Resources Committee (HRC), which is the local deliberative body tasked with historic A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
evaluation and recommendations, including adding and deleting properties from the City’s Historic Resources Inventory. See Exhibit 5 for the full appeal documents.
Analysis
According to the EIR and as part of the project’s LCP-required historic review, the City found that the existing ATC buildings are not listed on any national, state, or local historic preservation registers, but do contain important historic elements of note. The EIR found:
55 The American Tin Cannery does appear individually significant under Criterion 1 (Events) as a property that is individually associated with events that have made a significant contribution to the broad patterns of local or regional history, or the cultural heritage of California or the United States. The American Tin Cannery, originally known as the American Can Company, directly contributed to the development of the Monterey Peninsula fish canning industry. Between 1927 and 1954, the complex served as the sole producer of the famous Monterey onepound oval sardine can. The plant’s physical location in proximity to the industry, its use of modern methods of production, and its ability to efficiently produce the product, assured a competitive edge for the Monterey sardine fishery against its southern California competitors. The growth of the industry and the success of the American Can Company was directly tied with industrial development during the City’s 1927-1945 period of development, as identified in the Pacific Grove Historic Context Statement (2011). (emphasis in original) Thus, the site’s use has played an important role in local and state history. In addition, architecturally, the site similarly is of local importance, including because it’s the only former industrial canning building in Pacific Grove (with other nearby historic canning facilities along Cannery Row in Monterey having predominantly since been redeveloped into hotels and other uses, including the adjacent Monterey Bay Aquarium which used to be the Hovden Cannery). In addition, and while the site is not a canning facility anymore and is instead a mix of retail and commercial uses, the upcoast portion of the site is the only known example of Art Moderne design in Pacific Grove, and its distinctive ‘sawtooth’ roof too has some architectural distinction related to same. In short, the current buildings are not formally listed in any historic inventories, but they do hold some relevant local historic significance.
The City-approved project would partially demolish the ‘sawtooth’/Art Moderne building and completely demolish the neighboring warehouse building. While the City’s approval incorporated a series of EIR-identified measures to mitigate for potential historic impacts (including maintaining most of the sawtooth building and restoring its character-defining elements in conformance with National Park Service historic repair/preservation standards, and including a public interpretive display highlighting the building’s past importance in the canning industry), the EIR nevertheless found that the project would have significant and unavoidable impacts to historic resources. The EIR found: “the American Tin Cannery will no longer retain sufficient historic integrity to convey its 55 See Draft EIR page 8-25.
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significance and will no longer be eligible for listing in the California Register of Historical Resources or the Pacific Grove Historic Resources Inventory.”56 While the EIR concluded that the project would result in adverse historic impacts, the City approved the project nevertheless through a Statement of Overriding Consideration. Some of the rationale for this finding was that the project met LCP objectives related to historic preservation and coastal resource protection more broadly.
In short, the City, during CEQA and CDP review, analyzed the site’s potential historic attributes, documented and described them, and required certain measures to retain some of the more important historic attributes, particularly the distinctive sawtooth roof element. The City found that demolition of the warehouse building was better from an aesthetic perspective in terms of not having industrial facilities located in a prime and conspicuous waterfront location, and that the sawtooth building’s facade changes would break up mass and scale by creating courtyards and other architectural interest. In other words, the City balanced the need for historic resource protection with other LCP coastal resource objectives. And the LCP allows modifications to structures with historic elements, whether listed or not, and the City appropriately followed its prescriptions.
These are all reasonable conclusions, particularly in light of the fact that some of the most character-defining elements of the existing site will be retained, and that many of these historic canneries in the area have been repurposed over the years into other similar modern uses where history can be honored while also adaptively reusing these facilities for modern purposes. The City’s approval does not raise a substantial LCP conformance issue with respect to historic protection.57
7. The “Five Substantial Issue” Factors
When considering a project on appeal, the Commission must first determine whether the project raises a substantial issue of LCP conformity and/or Coastal Act public access conformity, such that the Commission should assert jurisdiction over the CDP application for such development. At this stage, the Commission has the discretion to find that the project does or does not raise a substantial issue of LCP and/or Coastal Act conformance. The Commission’s regulations lay out the following five factors that it may consider when determining whether the issues raised in a given appeal are “substantial” (14 CCR section 13115(c)): the degree of factual and legal support for the local government’s decision; the extent and scope of the development as approved or denied by the local government; the significance of the coastal resources affected by the decision; the precedential value of the local government’s decision for future interpretations of its LCP; and, whether the appeal raises only local issues as opposed to those of regional or statewide significance. The Commission may, but need not, assign a particular weight to a factor, and may make a substantial issue determination for other reasons as well.
56 See Draft EIR page 8-24.
57 In addition, the City’s Historical Resources Committee is not listed in the LCP as having any required CDP reviewing authority or given legal status to review CDP applications. This contention too does not raise a substantial issue. And the project’s historic elements were reviewed by the Architectural Review Board, Planning Commission, and City Council, thereby providing sufficient historic review in this regard.
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In this case, these five factors, considered together, support a conclusion that the City’s approval of a CDP for this project does raise a substantial issue of both LCP conformance and Coastal Act public access conformance.
In terms of factual and legal support, while the City’s record is voluminous and was reviewed by various deliberative bodies, certain factual and legal conclusions are not well founded, specifically in terms of water supply (e.g., rote reliance on the MPWMD’s water allocation provisions to satisfy LCP water supply requirements and findings without any independent analysis is not legally adequate), lower-cost accommodations (e.g., feasibility assessments, mitigation fee amounts, specifying the only persons who are eligible for lower-cost rates when the LCP prohibits same), and public coastal access (e.g., finding the project maximizes public access while bona fide public access impacts of the project related to the loss of public streets remain unmitigated). These findings suggest a substantial LCP conformance issue.
In terms of the extent and scope of development, by almost any measure, the project is large, and would be one of the largest on the entire Monterey Peninsula, spanning almost 6 acres and multiple City blocks. Its size, and particularly when understood in relation to the number of coastal resource issues implicated (water supply, habitat resources, lower-cost accommodations, public views, public access, etc.) and the other substantial issue factors, clearly argues for a substantial issue determination.
In terms of potential precedential and prejudicial impact, it should first be noted that any one case, like this one, is decided on its specific facts and its specific merits, and is not entirely dispositive as to how subsequent CDP decisions will be made. At the same time, there is always the potential that the City (and/or potential future applicants) might see the City’s action here as precedential. And in fact, it is possible that such a decision could have ripple effects on nearby communities and their LCP implementation related to the City’s interpretation of shared issues, particularly water supply, that could be used in relation to other projects in the Monterey Peninsula coastal zone that are subject to similar water issues, and thus it’s important to analytically get it right, which also argues for substantial issue.
In terms of the significance of the coastal resources involved, the project includes a suite of significant coastal resource issues, ranging from water supply (and the accompanying impacts to the sensitive aquatic environment) to lower-cost accommodations to public coastal access to marine mammal protection, which also argues for substantial issue.
Finally, in terms of whether the appeal raises only local issues as opposed to regional or statewide issues, all of these issues are important locally as well as statewide given the breadth and scope of the coastal resources implicated as described above.
Taken together, the City-approved CDP for the project does not adequately address Coastal Act public access and LCP coastal resource protection issues, and the five factors, individually, and on the whole, support a finding of substantial issue as to conformity of it with the Coastal Act and the certified LCP. Thus, for the reasons stated herein, the Commission finds that Appeal Number A-3-PGR-22-0004 raises substantial issues with respect to the City-approved project’s conformance with the certified LCP A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
and the public access policies of the Coastal Act and takes jurisdiction over the CDP application for the proposed project.
H. De Novo Coastal Development Permit Determination
The standard of review for this CDP determination is the City of Pacific Grove certified LCP. All Substantial Issue Determination findings above are incorporated herein by reference.
1. Proposed Project
On de novo review and including in response to the issues identified in the preceding Substantial Issue analysis, the Applicant has modified their proposed project. While its core elements remain the same in terms of it being a full-service hotel resort, several changes have been proposed in response to the substantial issues previously identified regarding the former City-approved version. The newly proposed project is reduced in size and scope from 225 hotel rooms to 206 (along with a ‘Group’ wing with 64 beds in 16 units in a shared accommodations construct), removal of one pool and spa (from 2 pools and 2 spas to one pool and one spa), relocation of a vehicle entrance/turnaround along Ocean View Boulevard and replacement with a public park/open space along the intersection of Ocean View Boulevard and Dewey Avenue, and an overall reduction in square footage of some 85,000 square feet. In addition, and as explained in more detail in the subsequent findings, several project elements have also been modified, including now providing direct public access to the ‘living’ green roof from the new public park and direct public bathroom access from Eardley Avenue, and a new lower-cost accommodations component comprised of 18 on-site traditional hotel rooms at LCPdefined lower-cost rates, a 16-unit/64-bed on-site Group wing with shared accommodations, and low- and no-cost overnight stays for lower-income groups for 300 guest nights (i.e., one guest for one night) per year within the Group wing, all as described in more detail subsequently.
2. Water Supply
As discussed in the preceding Substantial Issue determination, the Pacific Grove LCP can largely be understood as a two-step process. The first step is ensuring that the City has a sufficient water allocation to provide the site with water. This can largely be understood as whether the particular site in question has a water allotment from the Monterey Peninsula Water Management District (i.e., whether the site is allowed water in the first place pursuant to the District’s water management programs and policies).
And the second step is ensuring that such water is coming from a source and in an amount that is environmentally sustainable. On this point, the Commission has typically understood ‘sustainable’ to mean water that is being extracted in such a manner as to not have any adverse impacts to sensitive coastal resources, including wetlands, streams, creeks, the ocean, and other aquatic habitats.
Regarding the first point, as discussed, MPWMD has allotted 18.53 AFY of water to the ATC site, which it finds is both the amount the City is allowed to allocate for the site, and which represents what the site is equipped to accommodate at full use. This metric is what the District uses to ascertain the amount of water an existing site is ‘allotted’ and thus what it will allow Cal-Am to serve. As applied to this project, the District has indicated that, so long as water usage remains at or below this amount, the project A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
doesn’t run afoul of their water allocation provisions. To be clear, this provision of the LCP is akin to the requirement for a ‘will-serve’ letter or some other type of affirmative determination that the applicable water provider can and will legally provide water to the proposed development, including in conformance with their own procedures. If the entity cannot or will not provide water for whatever reason, then this independently would require a project’s denial regardless of whether the water source is sustainable or not.
In other words, this prong of the LCP can be understood as a factual yes or no in terms of the water provider allowing water to be served to this proposed project. The District has said yes, so long as it’s below the 18.53 AFY amount. When viewed in this light, such determination can serve to satisfy the first part of the LCP’s water supply requirement as it relates to the allocation requirement.
However, regarding the second point, as explained in detail in the Substantial Issue findings, at this time, given the myriad factors facing the Monterey Peninsula’s water supply, including in terms of historic adverse impacts to sensitive aquatic species in the Carmel River as a result of water overconsumption, concerns regarding overdraft and seawater intrusion in the Seaside Groundwater Basin, the State Water Board’s CDO to prohibit new connections and intensifications of existing connections, and various uncertainties regarding the timing of Cal-Am’s desalination project, the efficacy of Monterey One Water’s Pure Water Monterey Expansion, and various determinations regarding the region’s water demand and supply assumptions, it cannot be found at the current juncture that such water would currently come from a long-term, sustainable supply.
In light of such determination, the question then goes to how to apply such understanding to this proposed project. While it’s more straightforward to apply this understanding to a new use on vacant land (as it’s clearly new water-using development when there isn’t available supply to newly serve it), it’s somewhat more complex to apply it to existing developed sites. One way to understand it is that the public policy goal of the area is to reduce water usage from existing levels so as to bring the Peninsula’s water usage into a sustainable state. As such, it doesn’t really matter if there is an existing water-using use as any form of new water-using development must be denied unless and until the requisite Coastal Act findings regarding water supply health and adequacy can be met. This position would certainly be consistent with the intent of the State Water Board’s CDO, which is premised overall on the requirement to reduce water usage to legal and sustainable levels. Reducing water usage would also clearly be consistent with the LCP’s requirement to protect sensitive aquatic resources and only provide water in an amount that sustains such resources. Applying this understanding to this proposed project would result in its denial, as there wouldn’t be any water available to serve it unless and until there is evidence about the sustainability of the region’s water supply.
A second way to approach this is to cap water usage at existing usage amounts. The idea in this scenario would be to recognize that there is currently water flowing at the site, and thus limiting new development to that actual flowing amount wouldn’t exacerbate the problem. It would effectively maintain the baseline status quo. The question then would become one of how to calculate and determine the appropriate ‘baseline’. The MPWMD has its own protocols for doing so, including establishing water A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
demand and use calculations based on the site’s ‘capacity for use’, or what the site is physically equipped to accommodate water-wise at full build out rather than what it actually uses. The State Water Board has opined that, while the District’s ‘capacity for use’ method may be appropriate in some cases, another analytically compelling method would be to determine the actual average water use for a water year from the past five years, or to use both methods and use whichever is the lessor amount. This makes sense for a variety of analytical reasons, not the least of which being that the idea that a baseline should be based on the amount of water the site could use at full occupancy and use is also inaccurate from a CDP perspective inasmuch as changes in use and changes in intensity of use, such as would occur should new/different tenants come into the space, is development requiring its own CDP, and such development itself would be required to meet the same LCP water supply tests as this proposed development, and would not be somehow ‘grandfathered’ in and allowed to use that amount of water no questions asked. As a result, the concept embedded in the District’s ‘full use’ baseline is inherently flawed.
That said, MPWMD has strongly opposed the use of actual water consumption data, arguing that doing so may incentivize prospective property sellers to artificially increase water use to facilitate changes in use by prospective buyers, as well as penalize those that implement conservation features to reduce water consumption. Additionally, MPWMD claims that it is unlawful to use actual water consumption data because it would violate CPUC policies regarding customer privacy, 58 and MPWMD’s Board even
went as far as to adopt a resolution identifying the flaws and legal problems associated with using actual water data, and concluding that they will not do so when establishing baseline water usage.
59 It should be noted that Commission staff, despite repeated requests for same, were not given the actual flowing water records for the ATC site, with the non-disclosure agreement cited as justification for not doing so, even if it appeared to staff that the property owner and underlying site users weren’t under the same restrictions as MPWMD and Cal-Am, and could have provided such data legally as it was their own water data. In any case, and as a work around, the actual flowing water for the site can be estimated by using the District’s water use factors as applied to only the square footage that is currently occupied by a tenant, thereby avoiding counting vacant space as using water. Commission staff worked with the Applicant to get such rent data, and then applied the water use factors to that square footage. The results of that exercise show that, as of July 2022, the estimated total water use was 5.924 AFY, with water use as of July 2021 at 8.030 AFY, and, pre-Covid, at 13.159 AFY as of July 2019. While it is true that the pandemic and the project’s pendency has led to some increases in vacancies, which could skew such numbers, it is also true that the site has not been at full occupancy and use for many, many years, and since well before 2019.
Using these numbers as a proxy for what the State Water Board suggests is a more 58 Specifically, the District cites to a non-disclosure agreement required by Cal-Am of its customers as a prerequisite to providing water service that prohibits providing access to water use records to anyone other than the specific account holder. The District indicates that this agreement means that neither MPWMD nor Cal-Am are legally allowed to provide actual water consumption data for existing service addresses.
59 See Resolution No. 2018-05 adopted in 2018 at:
https://www.mpwmd.net/resolutions/2018/Resolution2018-05.pdf.
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accurate determination of existing/baseline water use shows that the site’s running water has ranged from roughly 6 AFY to 13 AFY. And applying this metric to the site would yield a pretty significantly downscaled project.
And finally, a third permutation, and related to the second one, is to cap water usage in line with what the MPWMD did for this site in terms of its capacity for use. As described previously, the MPWMD’s 18.53 AFY water allocation is based on the amount of water the site is physically equipped to accommodate at full occupancy. Water usage fluctuates, particularly at a commercial building where tenants routinely change hands, which is evident by the fact that the site appears to have used only about 6 AF last year, but three years earlier it had used about twice that amount. And, to the District’s point, looking at actual water usage can lead to deviations for a variety of reasons, particularly for commercial spaces, that can make it difficult for use in planning applications like this.
At the same time, this is simply ‘paper water’ inasmuch as it doesn’t actually reflect running water, nor the long-term sustainability of its source. When using this method, which is the version relied on by the District and the City, the site would be allowed no more than the 18.53 AFY identified/allocated for this site.
Each of the three permutations runs across the spectrum of methodologies for evaluating water use under the LCP. The most conservative approach, of course, would be the first alternative (no new water use allowed scenario) that indicates that no water use at the site is permissible pursuant to the LCP, which would require project denial.
While this would help address coastal resource impacts more broadly as it relates to water supply issues, the existing status quo at the site would remain, so it would only hold such impacts steady, and not actually decrease them. In other words, denial of this project would not mean that the existing commercial uses at the site also go away, and thus water use would be expected to continue at current levels (i.e., roughly 6 AFY). To put it another way, denial would eliminate new water use, but is not likely to reduce water use at this site and there is still the possibility of the site being entirely rented out and utilizing their full ‘paper’ water amount. That said, there would still be resource value to applying this scenario.
The second alternative (actual flowing water scenario) makes more sense since it is applying a more apples to apples comparison between the actual water currently being used at the site and what a future project would be using. In other words, the water use stays the same, but the use that is using it would change, from commercial uses to hotel uses. Application of this scenario suffers from the fact that there can be any number of reasons why water use might be at a certain level in an existing situation (including, as the District identifies, where potential applicants might try to increase their water use in order to be allowed a larger development in the future), but it also is more analytically pure because it compares actual before and after consumption, and allows for decisions to be made based on the water use difference, and what that difference means in terms of the applicable LCP coastal resource requirements and questions raised. Even with A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
the inherent issues, this scenario is probably the simplest, most straightforward, and analytically accurate scenario.60
And lastly, the third alternative would be to apply the District’s water use credits to the site as the District recommends (the estimated water use at full capacity scenario). This method is probably the least protective of coastal resources that are impacted by water demand, but it has the benefit of providing the market with greater certainty in terms of potential growth, even as it essentially represents ‘paper’ water credits and not actual water use. As applied to the subject case, it also is the option that allows the City to move forward with what it considers its largest growth opportunity site at the scale the City has long envisioned, going back to the citizens’ initiative from almost a decade ago that allowed the project at this location in the first place. And where that project is a visitor-serving project, a project type that has priority over other types of projects that might otherwise be considered here under the LCP and the Coastal Act. This scenario also leans most heavily on estimates that the Peninsula’s water supply issues are nearing a point where they will not lead to these types of difficult questions as a general rule, and where development may be able to proceed in the relatively near future based on a sustainable supply, thus mooting some of these very questions.
In short, it is a judgment call as to the best method to find LCP consistency, requiring the weighing of costs and benefits, including costs and benefits of different potential resource outcomes, and applying various temporal considerations. And while it may not be directly applicable to other potentially proposed development on the Peninsula, including as it is attributable uniquely to the context and attributes of the proposed project at this location at this time, the Commission here applies the third scenario.
Thus, as long as water use is below 18.53 AFY, then the Commission can find the project consistent with the LCP on this point. Special Condition 5 thus limits the approved project to that amount, and requires the MPWMD to provide written concurrence that the approved project in its totality (inclusive of all hotel rooms, restaurants, pool/spa amenities, and any other water-using development, and not offering ‘credit’ for off-site laundry or greywater system) is within such water budget.61 It also requires audits of actual water usage so as to ensure compliance with such water budget over time, and remedial measures if such usage is in excess of this limit.
MPWMD staff have reviewed the Applicant’s proposed project and has preliminarily confirmed that it falls under the prescribed 18.53 AFY amount.
3. Lower-Cost Accommodations
As described in the Substantial Issue findings, the Pacific Grove LCP includes a robust set of specific standards related to the provision of lower-cost accommodations. The LCP defines what qualifies as lower-, medium-, and higher-cost accommodations, 60 And has been the method repeatedly recommended by Commission staff for as long as this application has been pending at the local level; see Exhibit 7.
61 To be clear, this condition requires total water consumption to be within 18.53 AFY. If the Applicant provides signoff of the efficacy of on-site greywater recycling and use by requisite agencies (as required of Special Condition 1(d)), then such ‘credit’ could be understood in relation to the 18.53 AFY water budget. In other words, the condition doesn’t provide for a ‘credit’ per se, but rather such savings would be reflected in the amount of water the site actually uses.
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requires new development to provide lower-cost accommodations in an amount equal to at least 25% of the number of high-cost accommodations, and requires such lower-cost units to be provided on-site as part of the proposed project, unless doing so is found to be infeasible. On this point, the LCP requires a detailed analysis underlying the factors regarding a project’s infeasibility of providing such lower-cost units on site, including specifying the financial assumptions and rationale for this conclusion. If on-site infeasibility is determined, then the LCP allows for such lower-cost requirements to be satisfied by the payment of an in-lieu fee in an amount equal to providing new such accommodations units elsewhere in the City.
This LCP construct is specific and rather unique to the City, and three important points should be made. The first is that the standards are more robust and detailed than many other LCPs, which is reflective of the fact that the City’s LCP is the most recent newly certified one in the State. The LCP was fully certified for the first time, with the City assuming CDP review authority, in 2020, and thus the lower-cost provisions reflect some of the Commission’s most recent contemporary understandings of the importance of these issues. Second, the LCP speaks to the importance of providing lower-cost units on-site as part of the proposed project, with in-lieu fees and off-site units allowed only as a second resort due to on-site infeasibility issues. And this is for several reasons, including both the Commission’s general difficulty in getting in-lieu fees spent on actual new lower cost units, as well as the overarching goal of providing more equitable mixeduse/income accommodations types in the coastal zone, which is both a public access issue as well as an environmental justice issue. These understandings after almost 45 years of Coastal Act implementation helped inform the LCP’s on-site preferences. And third, and perhaps most importantly for this project, these policies were written with the ATC site in mind. This reason is twofold: one, the LCP envisioned a hotel at this site, with various iterations of hotel proposals in the past. And in fact, this particular hotel proposal was in its infancy when the LCP was being developed. And two, there simply aren’t many other sites in the City where new hotel development would be possible.
Due to water supply issues as discussed previously, and due to voter initiatives from the 1980s that restrict the building of new hotel units, developing new hotel units at all, let alone lower-cost ones, is a difficult endeavor in Pacific Grove. As such, and while the LCP’s lower-cost requirements apply throughout the coastal zone to all accommodations projects, there was a particular understanding of their applicability to the then-upcoming proposed ATC project to meaningfully provide lower-cost units and address this pressing affordable lodging issue in the Monterey Peninsula.
In this case, the Applicant is proposing 188 high cost rooms, which would necessitate the provision of 47 lower-cost ones (i.e., 25% of the higher cost rooms) whether on site, in an offsite project (i.e., a 47-room lower cost hotel), or a fee (calculated for 47 rooms to be some $22 million in this case.
62 In light of this, and in response to the articulated issues with the City’s previous approval, the Applicant revised its lower-cost proposal to include three parts. The first is to include 18 traditional, double-occupancy hotel rooms interspersed within the rest of the hotel. These units would be capped at the LCP’s defined lower-cost rates, which, as described previously, at the current time in 2024 62 Where that fee is inclusive of land acquisition, construction costs, and a 10% management fee, estimated to be $463,972.55 per unit, or $21,806,710.08 for 47 units: see Exhibit 6.
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would be no more than $184 per night. The second component is the construction of a ‘Group’ wing somewhat separated from the main hotel facility, but still on-site and part of the overall ATC hotel resort complex. In this area, there would be 64 shared beds within 16 units. Each bed would be priced at $85 with common areas and shared bathrooms (eight bathrooms in total, with each bathroom serving two units, or serving occupants of up to 8 beds total). And third, within this Group wing, the Applicant proposes a program to provide for low- and no-cost stays for groups, including from schools, underrepresented youth, and underserved communities. The Applicant proposes to provide at least 300 bed-nights per year63 in the Group wing for such programming, where 150 such stays would be free, and the others would be provided at lower cost (again, where each of the rooms wouldn’t cost more than $184 per night).
The Applicant indicates that the intent is also to work in partnership with the Monterey Bay Aquarium and other area attractions and educational facilities to provide for environmental education opportunities along with overnight stays.
There are numerous issues to discuss with respect to the Applicant’s proposal. It first should be noted that the proposal to provide for on-site lower-cost hotel rooms is clearly consistent with both the intent and letter of the LCP’s lower-cost requirements. That said, the LCP requires 47 such units, and this proposal is for 18, thus not all of the requirement is satisfied. The Applicant believes that the remainder of its proposal in terms of its proposed Group wing and its low- and no-cost group programming efforts fills in that remaining 29-unit gap. Their thinking is that, pursuant to the Commission’s general understanding, including from research done by Hostelling International, a hostel bed utilizes about 125 square feet and a lower-cost, double-occupancy hotel unit 250 square feet. Thus, based on these typical unit sizes, the Applicant seeks a ‘2:1 conversion’, meaning that 2 hostel beds are equivalent to 1 hotel room or “unit” for LCP purposes. In other words, the Applicant wants the Commission to consider the 64 beds in 16 shared rooms (with shared bathrooms) to be the equivalent of 32 standard lower cost hotel rooms. And the Applicant posits that, along with programming efforts totaling some 300 bed-nights per year within, more than satisfies the LCP’s requirements.
A first question is how to treat the proposed hostel/group/shared accommodations construct as a form of lower-cost accommodation. One could argue that these units are inferior to the luxury hotel units being proposed in the main hotel complex, and that the lower-cost units should all be like-for-like in terms of affordable hotel rooms (with private bathrooms, minimum double occupancy, and on the same grounds/treated in all the same manner as the rest of the hotel). Another way to look at it is that these type of proposed shared accommodations are an affordable way to target single travelers and couples who may not need a full hotel room and would benefit from cheaper shared accommodation. In addition, these types of units would be geared toward the budget conscious traveler and would therefore be more amenable to being reserved for and used by those who need such lower-cost accommodation the most, rather than a lowcost hotel room that could be used by a higher-income traveler who would already be 63 Where one bed-night is when one user of one bed stays one night. At full occupancy of the Group wing, and its 64 total beds, a group of 64 staying for one night would take up 64 of the 300 bed-nights.
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looking to stay at the high-end ATC hotel. In other words, a hostel/group quarters might naturally better target those of lower income and be more fruitful in this regard.
Still yet, there are questions as to how to analytically compare an $85 per bed shared room (4 occupants) with an individual $184 lower-cost hotel unit at double occupancy.
When looked at from the perspective of a single traveler or couple, the price point would be below the $184 threshold and could therefore be considered lower-cost, bracketing whether this is a correct comparison between these two accommodations types (i.e., sharing rooms and bathrooms with strangers). However, when looked at the price per unit, the four beds in the hostel unit would be $340, almost double the $184 hotel room cost and clearly not lower-cost, particularly for a family of four who each want their own bed. In addition, while the Applicant believes the correct comparison between these two accommodations types is two hostel beds to every one hotel room, there are questions as to whether this is appropriate or not. While square footage and occupancy may lead to the 2:1 conclusion, based on other metrics, like privacy, bathrooms, and price per unit/bed, these are analytical apples and oranges that do not lend themselves to a clean 2:1 conversion.
In light of all of this, several points can be made. First, all of the benefits and limitations identified previously regarding hotel vs. hostel/group quarters can be true. It is accurate to state that hostels can provide a specific type of accommodation for couples and single travelers, and can better naturally target the type of budget conscious traveler for whom such lower-cost rooms are intended. And, based on the proposed rates, the proposal can be understood as lower-cost for those that seek hostel style accommodations – usually single travelers, couples, or groups of friends on a budget.
But it’s also true that many people, including families with young children, will not seek and will not be comfortable in a shared accommodation construct and will instead seek a traditional hotel room. And in a hotel project with 188 traditional hotel rooms, and in an area with severe limitations in terms of where additional hotel units can be built (again, due to water scarcity, voter restrictions, lack of vacant properties, etc.) where it is imperative to take full advantage of the extremely limited opportunities for when units of any type are proposed, the lower-cost units provided should reflect the rest of the product, and thus include lower-cost hotel units. And, again, such lower-cost hotel units are more conducive to serve as an option for families, where they would be more likely to seek out the privacy and lower-cost price point associated with this accommodation type over a group quarter. As such, a package/mix provides the benefits of both of them.
Second, while the Commission understands the rationale behind the Applicant’s 2:1 hostel bed to hotel room conversion based on size alone, the other inherent differences between the two accommodations types simply does not lend itself to such a ‘clean’ ratio. Two twin hostel beds in a shared room is simply not the same as two twin beds or one queen size bed in a private traditional hotel room. A more apt comparison between the two would be to compare units for units, in this case one hotel room with one hostel unit. The Commission can then understand the proposed Group wing to be comprised of 16 units. Thus, the proposed project provides 18 hotel units and 16 group/hostel units.
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And third, while it is an even more ‘apples to oranges’ analytical comparison between units and lower-cost programs, the Commission can ‘value’ the Applicant’s proposed group programming provisions within the context of the LCP’s on-site lower-cost requirements for this project. And in this case, the proposal seeks to provide at least 150 free and 150 lower cost stays per year for those who traditionally may not be able to experience a coastal zone stay and related activities. This represents a meaningful lower cost accommodation benefit, and clearly is in line with the Commission’s environmental justice principles and the objective of ‘access for all’. Again, it is acknowledged that this isn’t a perfect analytical fit, and that the program will mean that the Group wing isn’t available to other users during these group occupancy times. But the ability to provide free and lower cost group accommodations so close to the shore and in such a highly visible and prime coastal locale for schools, youth groups, and other underrepresented communities is something that strikes at the heart of the Commission’s lower-cost accommodations, public coastal access, and environmental justice mandates.
In short, while some may argue that the Applicant should provide 47 standard doubleoccupancy hotel rooms on site at a lower cost to satisfy the LCP, the Applicant has actually proposed a mix of lower cost amenities to satisfy the LCP, and that package can be considered by the Commission as well. The fact that the Applicant is proposing eighteen on site, lower cost hotel rooms is significant, including as it has been difficult in the Commission’s experience to get fully integrated lower cost rooms as part of these types of projects, and there’s a significant benefit to having that in this case. In addition, the 16 hostel/group rooms perform a different lower cost function, and target a different type of user, which provides a range of different accommodation options. Together, and together with the group programming aspect, the Applicant has proposed a significant lower cost visitor serving package, one that avoids in-lieu fees, and actually targets onsite and offsetting lower cost facilities, where the package can be considered adequate to satisfy the LCP’s requirements in a slightly different way.
As such, Special Condition 6 codifies the Applicant’s proposal, and includes important measures to ensure that these lower-cost provisions are effectively carried out over time. Among other things, the condition specifies that the lower-cost thresholds are caps,64 and that all hotel fees, including parking, resort fees, and administrative fees, with the exception of government-imposed fees/taxes, are to be reflected/included in that price. The condition also specifies some minimum standards for the lower-cost units, including that such hotel rooms must be at least 250 square feet (with a queen size bed or two twins) and all users of the lower-cost hotel units and the hostel/group quarters are required to have access to the same amenities in the rest of the hotel as would any other paying guest, including those in the high cost rooms. As for programming, while the condition is meant to be slightly broad in order to be nimble enough for flexibility in program elements, the condition does specify some overall minimum performance standards, including requiring at least 300 bed-nights per year of group stays, with 150 of those free and the other 150 capped at the LCP’s lower-cost 64 Subject to changes with the Consumer Price Index.
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unit threshold,
65 specifying that the targeted clientele is those from lower-income communities, communities of color, and other communities that have been historically marginalized and face greater barriers to coastal access, and requiring yearly monitoring reports that identify program effectiveness and group composition, along with the proposed programming for the upcoming year. The condition also requires yearly monitoring and a third-party audit every third year to help measure effectiveness of the lower-cost provisions overall, as well as outreach to market such rooms to inland communities, including in Spanish and other appropriate languages.
And finally, Special Condition 7 requires that all overnight accommodations (hotel rooms and group quarters) be open and available to the general public, that rooms shall not be rented to any individual, family, or group for more than 29 consecutive days and that no individual ownership or long-term occupancy of hotel rooms shall be allowed. To further ensure that the hotel operates as proposed and approved, Special Condition 7(b) prohibits the conversion of any of the hotel overnight rooms to limited-use overnight visitor accommodation units (e.g., timeshare, fractional ownership, etc.) or to full-time occupancy condominium units or to any other units with use arrangements that differ from the approved project, as well as requires annual monitoring reports to ensure same.
In conclusion, the Applicant has proposed a meaningful package of lower-cost accommodation types that can serve as lower cost options for families (in 18 such hotel rooms), for single/couple travelers (in 64 beds in shared group accommodations), and for underserved groups (via at least 150 free and 150 lower cost stays for group programming). The Commission welcomes – and prefers – these types of on-site lower cost packages as a means of addressing Coastal Act and LCP lower cost overnight accommodation issues, and finds that as conditioned the project can be found consistent with the LCP.
4. Public Views/Community Character and Public Access
As described in the Substantial Issue section previously, the LCP is protective of public views, including stating that the visual qualities of Pacific Grove’s coastal areas are a resource of public importance, requiring development to be compatible with its built and natural environment surroundings, and otherwise ensuring development does not significantly adversely impact significant public views. To meet these overarching objectives, the LCP specifies that protection of scenic resources and other coastal resources must be the priority in all City actions and decisions, and that all development standards (including with respect to height, setback, density, lot coverage, etc.) must be interpreted as maximums (such as for height) or minimums (such as for setbacks) that are required to be reduced (or increased) to protect and enhance such resources to the maximum extent feasible. And for the project site specifically, development needs to include sufficient articulation and massing so as to avoid the appearance of domineering over the adjacent public realm.
65 Meaning that 150 guest nights are free, and 150 guest nights are capped at the LCP’s lower-cost threshold of $184 per night as of 2024.
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In addition, because the project site is located in such a visually conspicuous and popular visitor-serving location, the LCP only allows the proposed site coverage of up to 90% if significant public access amenities are provided beyond which the LCP would ordinarily require. In other words, the LCP requires some of the allowed site coverage to be programmed for public plazas, parks, restrooms, and similar public access amenities so as to maximize public recreational access and utility at this important site. With such requirements, and with the overall understanding that the LCP mirrors the Coastal Act in terms of the requirement to maximize public recreational access opportunities, the issues of access and views/character are largely intertwined. In short, the project needs to respect its surroundings and ensure that public access is an intrinsic part of the project.
Analysis
As described previously, while the overall site plan and design aesthetic has largely been retained from the City-approved version, the Applicant has made some modifications to better address views and access, including to ‘fix’ some of the issues and problems identified from the City’s approval. There are several design changes, including by overall making the project smaller by some 85,000 square feet and removing a proposed vehicular ingress/egress along Ocean View Boulevard. Doing so provides for the creation of a new public park/plaza at the downcoast site corner at Ocean View Boulevard and Dewey Avenue. Such change, along with other proposed articulation and small ‘pocket’ plazas along the rest of the Ocean View Boulevard frontage and proposed landscaping, should help to soften the perceived mass and scale of the building from the road and from the Monterey Bay Coastal Trail, which is a key LCP objective so as to avoid structures looming over the public viewshed. In addition, the Applicant has also modified certain public access elements to better meet LCP objectives, including now providing direct access from the new park to the living roof, which itself will be open and available for public enjoyment with benches, interpretive displays, and other amenities. The living roof area will aid in public enjoyment and offer an exciting opportunity for the general public to obtain expansive views of Monterey Bay from an elevated vantage point. In addition, the public restroom has been relocated closer to Eardley Avenue so as to better provide for access and use for the general public without having to venture deep into the hotel itself. Having a readily accessible public restroom, particularly in this area with the many children and families coming to and from the Monterey Bay Aquarium, is an important public benefit.
The Applicant firmly believes that the proposed design and access offerings materially will benefit this site over the existing status quo and meet the LCP’s requirements for this site, including going ‘above and beyond’ what would ordinarily be required and provide extra benefits for the public and not just hotel guests. They opine that this project isn’t introducing a new structure to a currently undeveloped site, or even one on the seaward side of the road or fronting the shoreline, but rather is replacing the existing ATC building which itself is a large two-story structure that takes up the entire City block with little setback from the road and few amenities geared to the general public. And while the sawtooth building includes some notable and distinctive architectural features (and these features, like the roof, will be predominately retained), it otherwise is a flat, uninterrupted plane along this visually prominent stretch.
A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
While reasonable people can – and often do – disagree when it comes to matters of design and community character, in this case and given the context, the Commission agrees with the Applicant’s assessment. While the project is clearly still quite large, and there could be other permutations that could further add articulation (e.g., not building in the Sloat Avenue right-of-way and keeping it as a public street) or otherwise reduce its size and scope, it’s also true that the site is not pristine. Rather, the site is a mix of old industrial buildings and surface parking lots that can be put to better and higher uses. In sum, the project will provide for some pretty substantial public access benefits that materially will benefit the public, and will do so with a design approach that similarly respects the character of the area as much as possible for a large project of this type.
Special Condition 1 thus approves the proposed site plan and overall design, and includes a series of conditions and performance standards to ensure consistency with LCP design requirements, including final plans that specify landscaping (e.g., only using native and non-invasive species to provide for visual softening and screening of structural development), signage (e.g., reducing their number and visibility, and using natural materials and earth tones to effectively blend in with the surrounding aesthetic), lighting (e.g., using wildlife friendly lights facing downward and shielded to prevent light spill and glare), utilities (e.g., placing them underground or away from public view), and windows (e.g., using non-glare and bird safe glass) to all be compatible with the overall area design aesthetic. And Special Condition 4 similarly codifies the proposed public access amenities via a Public Access Management Plan, with provisions to ensure that such amenities (e.g., the public park, living roof, and public restroom) are clearly identified on final plans, adequately signed to alert the public of these spaces, include appropriate amenities to aid in their enjoyment (e.g., benches, picnic tables, and trash cans), and maintained over time to maximize their use and utility in this regard.
That being said, the proposed project does materially affect public parking and the use of public street space. The project still proposes to convert portions of the existing Sloat Avenue public street to private hotel use. Doing so will result in the loss of some 20,000 square feet of publicly owned space, 17 parking spaces along the street (along with an additional 7 spaces lost along Dewey and Eardley Avenues due to curb cuts, driveways, and similar measures to access the proposed hotel), as well as its sidewalk space and corresponding ability for the public to easily walk between Eardley and Dewey Avenues.
The project also proposes to encroach into the Ocean View Boulevard right-of-way with an elevated sidewalk that will be privately owned but open to public use, totaling some roughly 3,000 square feet. While the Ocean View Boulevard encroachment can be addressed through conditions that clearly state that such elevated walkway is to remain open and available for public use without obstruction (and Special Condition 1(a) does just this), the Sloat Avenue and public parking impacts require more evaluation. The privatization of this area represents both a direct, quantifiable impact,66 including direct loss of parking spaces, as well as a more intangible loss of public space to private use that is difficult to fully quantify. Public space of any type, particularly so close to the 66 As part of the City’s street right-of-way vacation efforts, the appraised value of the roughly 20,000 square feet of road space that would be sold to the Applicant was valued at roughly $2 million, or about $200 per square foot (as of December 2021). The City has not yet sold the street, pending resolution of the Commission’s action on this CDP.
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ocean and prime visitor-serving uses, is a valuable common resource that must be protected, or, at a minimum, sufficiently mitigated. While one way to address this issue is through alternative siting and design that eliminates the privatization of this street, including eliminating it from hotel use (and instead having elevated walkways above the street to connect ‘wings’ on either street side, as is done with some structures along Cannery Row) and thereby avoiding the impact in the first place, another way is to ensure that the public utility of the street space is fully mitigated.
The Applicant proposes to mitigate for the loss of parking by adding six on-street spaces (through elimination of existing driveways that serve the existing ATC site), and providing 20 new spaces in a new paid public lot at 124 Central Avenue. The end result will be a net gain of 2 spaces. And while this is true, it’s also true that the public is losing sidewalk space, that the new spaces will be located further away and not as close to area amenities, and that the public’s real estate is lost. The on-street parking around the ATC site represents some of the closest, low-cost parking for visitors to the Monterey Bay Aquarium and Monterey Bay Coastal Trail. To access the coast, visitors who park in the public lot on 124 Central Avenue will have to traverse around the ATC hotel and downhill from Central Avenue. This represents an even greater barrier for visitors with ADA-needs.
67 In short, the Applicant’s public parking proposal does not have the same utility nor access to the coastline as the on-street parking spaces that will be removed around the ATC site, and thus does not sufficiently mitigate for the impact.
To do so, Special Condition 4(d) requires the 20 spaces in the public lot to be free for 6 hours a day subject to a 3-hour maximum stay for any one vehicle (and ADA spaces free all day and not subject to such restrictions). This requirement recognizes that the utility of these spaces isn’t as high as the status quo, and thus to make up the difference, the spaces are free of charge during this time frame. Along with the fact that there is a net increase in public parking overall, the finding can be made that parking and public space impacts from Sloat Avenue’s conversion to private use are appropriately mitigated in this way. To further ensure that the project addresses traffic and multi-modal transportation requirements, Special Condition 8 requires the preparation of a Transportation Demand Management Plan that requires, among other things, ride sharing programs and transit passes to reduce single-occupant car trips for workers, as well as shuttles and free bikes for guests to accomplish same.
As proposed and as conditioned, the project meets the LCP’s requirements for public view and public access protection and provision overall, as well as the specific directives for this specific site. It also adequately mitigates for the project’s impacts to public streets. The end result is a project that should be a measurable improvement over the status quo and one worthy of this prime coastal setting. 67 It should also be noted that the on-street parking spaces located on Ocean View Boulevard, Eardley Avenue, Dewey Avenue, and Sloat Avenue are authorized by a Commission-issued CDP (3-04-027) that allows the City to operate a metered parking program that includes a 2-hour time restriction for 31 parking spaces on Sloat Avenue and Ocean View Boulevard between 9am and 6pm, consistent with other 2-hour parking areas within the City (i.e., at Lover’s Point). Any changes proposed to the on-street parking spaces on these streets must obtain an amendment to the CDP, for which the City must apply.
A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
5. Habitat Resources
As explained in the Substantial Issue section, the LCP includes numerous provisions to protect the area’s rich biological resources, including policies mirroring the Coastal Act in this regard to prevent adverse impacts to environmentally sensitive habitats and biologically sensitive species, including marine wildlife haul-out, breeding, and nesting habitats located along the beaches and offshore rocky areas near the project site. The LCP also includes specific protections for marine mammals such as harbor seals. And while the project is located in an inland location and not physically within coastal waters, as identified in the project’s EIR and as noted in the substantial issue findings, the project’s construction may result in adverse impacts that transcend the site, particularly with respect to noise. And while the project’s EIR recognized such potential impacts and identified ways to mitigate them, it didn’t go into sufficient detail regarding the specific mechanisms by which construction noise and impacts would be defined, monitored, reported, and corrected should there be any.
In this vein, Commission staff, including the Commission’s Ecologist Dr. Rachel Pausch, has reached out to various local marine mammal and avian experts to best articulate the specifics of what would constitute adverse impacts and recommended monitoring techniques to sufficiently document such impacts should they occur. The result of such collaboration is the Marine Wildlife Protection Plan required by and specified in Special Condition 3. This condition builds upon that which the Commission required in previous projects in the area,68 and defines, among other things, the locations for habitat monitoring (i.e., the ‘Protection Areas’, defined as the three identified harbor seal rookeries at West Beach, Fisher Beach, and Fifth Street and out to at least 10 meters offshore), the protocols for where and how biological monitors are to assess for potential impacts (including provisions for on-site as well as remote monitoring), the specific behavioral cues for what may constitute an adverse impact (e.g., sustained head raises/alerts, rapid movements in response to acute noise stressors, feeding/nursing disruptions), and the notification process for when, in the monitor’s best professional opinion and in conformance with the identified criteria, construction noise is adversely impacting marine wildlife, including harbor seals and black oystercatchers.
These notifications include the Commission’s Executive Director, as well as other fellow resource experts at the Monterey Bay National Marine Sanctuary and NOAA Fisheries, and may, depending on the severity of potential impact, necessitate a stop work order and new CDP authorization.
Again, it’s important to reiterate that these are all precautions and that the EIR found that construction impacts should not be substantial, including in light of expected noise levels in these sensitive offshore environments, as well as with precautions to avoid the loudest construction activities during pupping season (which is similarly included in the special conditions). And that analysis was based on the previous City-approved project, which was larger and included more extensive grading than what is currently proposed.
In fact, the project’s smaller scope and elimination of certain structural elements along Ocean View Boulevard (and replacement with the public park/plaza) reduces excavation 68 Including in the Monterey Bay Aquarium’s new sea otter research and rescue facility authorized via CDP 3-23-0656-W.
A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
by about 27,500 cubic yards, which should translate into a reduction of noise and vibration impacts at the most seaward project location.
With such understanding and as conditioned, including ensuring that such provisions are identified as part of required Construction Plans (see Special Condition 269), the project can be found consistent with the LCP’s habitat resource provisions.
6. Archaeological/Cultural Resources
As shown on Figure 7 of the LUP, the entire coastal zone in the City of Pacific Grove has been designated an Archaeologically Sensitive Area, including the project site. The LUP requires development to implement reasonable mitigation measures to protect identified archaeological or paleontological resources. The LUP further requires a site survey and associated report, and a mitigation plan to be completed by a qualified archaeologist for projects within an archaeologically sensitive area. Applicable LUP provisions include:
LUP Policy CRS-1. The City will conduct consultations with any federally recognized California tribal government listed on the most recent notice of the United States Federal Register and any non-federally recognized California tribe listed on the California Tribal Consultation List maintained by the California Native American Heritage Commission that identifies as native to the Monterey Peninsula, including the Ohlone Costanoan Esselen Nation, in accordance with state law.
LUP Policy CRS-2. The City will ensure the protection, preservation, and proper disposition of archaeological resources within the Coastal Zone by assessing the potential impact of proposed development and ensuring, to the maximum extent feasible, that tribal concerns are considered before actions on proposed development are taken and that such impacts are avoided, minimized, or mitigated in conformity with the Coastal Act and other applicable legal requirements.
LUP Policy CRS-3. The City will assist developers and landowners by providing early identification of sensitive sites so that archaeological resources can be considered and protected during the early phases of project design. The City shall require new development to prepare an archaeological report by a qualified professional and, where appropriate, shall require mitigation measures to adequately protect and preserve potential archeological resources.
An archaeological assessment was included in the EIR and found that the project location has a high sensitivity for archaeological resources. Prehistoric shell middens and habitation sites have been recorded to the immediate northwest, north, and southeast of the project site and given their distribution and the recorded depths of deposition (approximately one meter below the surface), there is a high likelihood that 69 Special Condition 2 also includes the Commission’s suite of typical best management practices to ensure that construction activities avoid adverse coastal resource impacts, including on water quality and nesting birds. And Special Condition 9 also protects coastal water quality and habitats through a required Plastic Reduction Program to minimize single-use plastics in all aspects of hotel operations.
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additional prehistoric resources may lie beneath the current ATC facility complex.
Furthermore, the site is situated within the recorded boundaries of an historic Chinese village and intact deposits relating to this resource have been recovered within the project vicinity.
The Monterey Bay region is represented by the Ohlone/Costanoan-Esselen Nation (OCEN), which is comprised of over 600 enrolled tribal members of Esselen, Carmeleno, Monterey Band, Rumsen, Chalon, Soledad Mission, San Carlos Mission (Carmel) and/or Costanoan Mission Indian descent. The EIR documents the Applicant’s and City’s tribal consultation efforts, including working with OCEN officials to develop appropriate construction mitigation protocols (such as on-site monitoring during ground construction activities and stop-work orders should human or other sensitive remains/materials be unearthed).
Special Condition 10 carries forward these measures, and includes the Commission’s typical archaeological protection protocols, which, similar to the identified habitat resource protections, must be identified on all required construction plans. As conditioned, the project can be found consistent with the LCP’s archaeological/cultural provisions.
7. Other
Other Agency Approvals
In addition to CDP authorization under the Coastal Act and LCP, the proposed project appears to affect the Monterey Bay National Marine Sanctuary, which may need to provide authorization, and may affect marine resources that are protected by NOAA Fisheries, as well as water resources governed by the Monterey Peninsula Water Management District and applicable health and building departments. To ensure that the Applicant has a sufficient legal interest to carry out the project consistent with the terms and conditions of this CDP and to ensure that the proposed project is authorized by all applicable regulatory agencies, Special Condition 11 requires the Applicant to submit written evidence either of these other agencies’ approvals of the project (as conditioned and approved by this CDP) or evidence that such approvals are not required. Special Condition 12 also specifies that the Permittee is to follow all other requirements and conditions imposed by the City of Pacific Grove pursuant to their nonCoastal Act authorities. If there is any conflict, however, between those conditions and this CDP, this CDP shall govern.
Future Permitting
The Commission herein fully expects to review any future proposed development at and/or directly related to this project and/or project area, including to ensure continued compliance with the terms and conditions of this CDP through such future proposals, but also to ensure that any such future proposed development can be understood in terms of same. Thus, any and all future proposed development at and/or directly related to this project, this project area, and/or this CDP shall require a new CDP or a CDP amendment that is processed through the Coastal Commission, unless the Executive Director determines a CDP or CDP amendment is not legally required (see Special Condition 13).
A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
Minor Changes
This CDP authorizes the project proposed except as modified by the special conditions.
As is typical of large and complicated construction projects like this, there can be the need for minor changes as circumstances dictate. Thus, this approval allows for such changes through either (a) a CDP amendment, or (b) if the Executive Director determines that no amendment is legally required, then such changes may be allowed by the Executive Director if the Executive Director determines that such changes: (1) are deemed reasonable and necessary; and (2) do not adversely impact coastal resources (Special Condition 14).
Indemnification
Coastal Act Section 30620(c)(1) authorizes the Commission to require applicants to reimburse the Commission for expenses incurred in processing CDP applications. Thus, the Commission is authorized to require reimbursement for expenses incurred in defending its actions on the pending CDP applications in the event that the Commission’s action is challenged by a party other than the Applicant. Therefore, consistent with Section 30620(c), the Commission imposes Special Condition 15 requiring reimbursement for any costs and attorneys’ fees that the Commission incurs in connection with the defense of any action brought by a party other than the Applicant challenging the approval or issuance of this CDP, or challenging any other aspect of its implementation, including with respect to condition compliance efforts.
Deed Restriction
The terms and conditions of this approval are perpetual and run with the land, thus binding any future buyers and owners of the properties subject to this CDP. This approval is also conditioned for a deed restriction to be recorded against the property involved in the application (see Special Condition 16). This deed restriction will record the conditions of this permit as covenants, conditions and restrictions on the use and enjoyment of the property.
I. California Environmental Quality Act (CEQA)
CEQA Section 21080.5(d)(2)(a) prohibits a proposed development from being approved if there are feasible alternatives and/or feasible mitigation measures available that would substantially lessen any significant adverse effect that the development may have on the environment. CEQA further requires the decision-making agency to balance, as applicable, the economic, legal, social, technological, or other benefits, including regionwide or statewide environmental benefits, of a proposed project against its unavoidable environmental risks when determining whether to approve a project. If the specific benefits of a proposal outweigh the unavoidable adverse environmental effects, the adverse environmental effects may be considered “acceptable.” The City of Pacific Grove, acting as the CEQA lead agency, certified a final Environmental Impact Report for the project in January 2022. Pursuant to State CEQA Guidelines Section 15093, the City prepared and adopted a Statement of Overriding Considerations that notes that although the EIR identifies significant and unavoidable A-3-PGR-22-0004 (American Tin Cannery Hotel Resort)
impacts in the categories of Aesthetics and Cultural Resources,70 the City found that there are overriding considerations that provide specific economic, legal, social, technological, and other benefits, including region-wide or statewide environmental benefits, that outweigh the unavoidable adverse environmental effects.
The Commission’s review, analysis, and decision-making process for CDPs and CDP amendments has been certified by the Secretary of the Natural Resources Agency as being the functional equivalent of the environmental review required by CEQA (CCR Section 15251(f)). Accordingly, in fulfilling that review, this report has analyzed the relevant coastal resource issues with the proposal, has addressed comments received, and has identified appropriate and necessary modifications to address adverse impacts to such coastal resources. The Commission finds that only as modified and conditioned herein will the proposed project avoid significant adverse effects on the environment within the meaning of CEQA. Thus, the proposed project as modified will not result in any significant environmental effects for which feasible mitigation measures have not been employed, consistent with CEQA Section 21080.5(d)(2)(A).
4. APPENDICES
A. Substantive File Documents71
American Tin Cannery Hotel and Commercial Project EIR B. Staff Contact with Agencies and Groups
City of Pacific Grove Community Development Department California Public Utilities Commission
California Water Resources Control Board
California Department of Fish and Wildlife
Monterey Bay National Marine Sanctuary
United States Department of Fish and Wildlife
NOAA Fisheries
Monterey Peninsula Water Management District
Stanford University, Hopkins Marine Station
Unite Here
70 Cultural resources include archaeological and historic resources. In this case, the EIR found that the project would have significant and unavoidable impacts to historic resources, namely historic structures, but not archeological/cultural resources.
71 These documents are available for review in the Commission’s Central Coast District office.
Agenda No. 13 C
CITY OF PACIFIC GROVE
300 Forest Avenue, Pacific Grove, California 93950
TO: Honorable Mayor and Members of the City Council
FROM: Luke Coletti, Councilmember
MEETING DATE: April 03, 2024
SUBJECT: Ballot Measure(s) to Amend PGMC 23.45 and PGMC 6.11 CEQA: Does not constitute a Project per California Environmental Quality Act Guidelines Section 15378
RECOMMENDATION
Direct the City Manager to return to the Council with the documents necessary to place a measure(s) on the November 5, 2024, ballot asking the voters to amend Measure B (PGMC 23.45) and Measure C (PGMC 6.11) to implement the following:
1. Amend PGMC 23.45 to: (1) provide a definition for "timeshare" or "timeshare project," including those fractional interest uses marketed, sold, and managed as timeshares, and (2) allow the City Council to make any future amendments to the definition via Council Ordinance.
2. Amend (or rescind) PGMC 6.11 in order to be consistent with: (1) the proposed voter-adopted definition(s), and (2) the City's transient occupancy tax rate (i.e., existing timeshare projects (there are two) shall be taxed at the same rate as hotels/motels per PGMC 6.09).
DISCUSSION
Measure B (1982)
On November 2, 1982, Pacific Grove voters adopted Measures B, which: (1) prohibits timeshare projects throughout the city, and (2) imposes strict zoning standards on condominium development.
On November 17, 1982, the City Council adopted Ordinance 1315 N.S. (see Attachment-1), which codified Measure B under Chapter 23.45 of the Pacific Grove Municipal Code (PGMC).
PGMC 23.45 includes the following provisions:
23.45.020 Timeshare projects prohibited.
Timeshare projects shall not be permitted in the city of Pacific Grove.
23.45.030 Intention of chapter.
It is the intention of this chapter to avoid special privileges for condominiums and planned unit developments and to have such forms of development conform to the zoning standards and subdivision standards applicable to single-family residential district development. It is also the intention of this chapter in prohibiting timeshares to avoid the conversion and loss of the city's residential stock and character (emphasis added).
Definition of "Timeshare"
The authors of Measure B did not include a definition of "timeshare project." However, the zoning code at the time, which allowed timeshare projects as a permitted use (see Ordinance 1250 N.S.), included the following definition:
23.64.025 Use permit -- Timeshare project.
A timeshare project, as such term is defined in Section 11003.5 of the Business and Professions Code ...
At the same November 2, 1982, election, voters also adopted Measure C (see Ordinance 1316 N.S.), which established the following definitions:
6.11.010 (b) Time Share.
"Time-share" shall have the meaning as defined in Section 11003.5 of the California Business and Professions Code and in Section 23.64.025 of the Municipal Code.
6.11.010 (c) Time Share Owner.
"Time-share owner" means the person or persons who own one or more time-share interests in a time-share project within the city, whether or not approved under said Section 23.64.025 of the Code.
Section 23.64.025 was removed from the zoning code in 1997 (see Ordinance 97-22).
Section 6.11.010, last amended in 1997 (see Ordinance 97-39), is currently the only part of the city's municipal code that defines "timeshare":
6.11.010 Definitions.
"Time-share" shall have the meaning as defined in Section 11003.5 of the California Business and Professions Code.
"Time-share owner" means the person or persons who own one or more time-share interests in a time-share project within the city.
The Problem
The city's municipal code and definitions are out of date. For example, PGMC Section 6.11.010 references Section 11003.5 of the California Business and Professions Code, which was repealed by the State Legislature in 2004 (see Statutes of California 2004, Ch. 697, Sec. 4).
Conclusion
The Council should provide the voters an opportunity to amend Measure B (PGMC 23.45) and Measure C (PGMC 6.11) in order to better effectuate the City's longstanding prohibition of timeshare projects.
OPTIONS
1. Take no action.
2. Provide alternate direction.
FINANCIAL IMPACT:
It typically costs less than $10,000 to place a measure on the ballot of a consolidated (general or presidential) election (see Attachment-3).
GOAL ALIGNMENT: Not Applicable.
Attachments
1. Timeshare Ordinances (Pacific Grove)
2. Election Costs (Pacific Grove)
Election Date: 11/6/2012 11/4/2014 4/19/2016 11/8/2016 11/6/2018 11/3/2020 4/12/2022 11/8/22 Election Type: Presidential General Special Presidential General Presidential Special General Registered Voters: 9,547 9,213 9,338 10,165 10,025 10,694 10,450 10,488 Ballots Cast: 8,049 5,700 5,134 8,463 7,960 9,677 4,051 7,334 Turnout: 84.31% 61.87% 54.98% 83.26% 79.40% 90.49% 38.77% 69.93% Council Candidates: 9 6 0 6 7 6 0 6
Mayoral Candidates: 2 2 0 2 3 1 0 2
Local Measures: 1 0 1 1 2 1 1 2
Election Cost: $46,469 $17,055 $79,327 $38,503 $53,583 $60,671 $124,484 $63,595 Cost Per Registered Voter: $4.87 $1.85 $8.50 $3.79 $5.34 $5.67 $11.91 $6.06