CITY OF SANTA BARBARA
CITY COUNCIL
Randy Rowse
Mayor
Kelly McAdoo
City Administrator
Mike Jordan
Mayor Pro Tempore
Mike Jordan
Ordinance Committee Chair
Sarah J. Knecht
City Attorney
Alejandra Gutierrez
Finance Committee Chair
Eric Friedman
Oscar Gutierrez
Meagan Harmon
Kristen W. Sneddon
City Hall
735 Anacapa Street
http://www.SantaBarbaraCA.gov
FRIDAY, JULY 26, 2024, 9:00 AM
SPECIAL JOINT CITY COUNCIL/PLANNING COMMISSION MEETING AGENDA DAVID GEBHARD PUBLIC MEETING ROOM, 630 GARDEN STREET
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SPECIAL JOINT CITY COUNCIL/ PLANNING COMMISSION
MEETING AGENDA
CALL TO ORDER
PLEDGE OF ALLEGIANCE
ROLL CALL
WORK SESSION
1. Subject: Joint City Council and Planning Commission Work Session:
Direction on Housing Element Program Implementation (650.06) Recommendation: That City Council and Planning Commission provide direction to staff on adaptive reuse and hotel use zoning amendments to implement Housing Element Programs (HE-1 and HE-20).
PUBLIC COMMENT ON ITEMS LISTED ON THE AGENDA
ADJOURNMENT
CITY OF SANTA BARBARA
COUNCIL AGENDA REPORT
AGENDA DATE: July 26, 2024
TO: Mayor and Council
Planning Commission
FROM: Community Development Department
SUBJECT: Joint City Council and Planning Commission Work Session:
Direction on Housing Element Program Implementation
RECOMMENDATION:
That City Council and Planning Commission provide direction to staff on adaptive reuse and hotel use zoning amendments to implement Housing Element Programs (HE-1 and HE-20).
EXECUTIVE SUMMARY:
The 2023–2031 Housing Element identified programs to meet the city’s housing goals.
The purpose of this joint meeting is to receive guidance from Council and Planning Commission on implementing two of the adopted Housing Element programs:
HE-1: Facilitate Conversion of Nonresidential Buildings to Housing HE-20: Evaluate Hotel Zones
HE-1: Facilitate Conversion of Nonresidential Buildings to Housing is an implementation action focused on creating an adaptive reuse ordinance. Staff proposes a zoning ordinance to facilitate change-in-use from nonresidential to residential and requests feedback on which buildings/locations the ordinance should apply to.
HE-20: Evaluate Hotel Zones requires the City to identify and monitor trends in hotel development and review zones that allow hotel use in order to craft ordinance and map amendments that prioritize residential development over hotel development in appropriate areas. Staff requests feedback on proposed areas to modify hotel use regulations in the zoning ordinance.
Agenda Item No. 1
File Code No. 650.06
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
DISCUSSION:
The analyses covered in this report focus on inland areas regulated by Title 30 ZoningInland and do not consider the coastal zone. The coastal zone is excluded because Section 30222 of the Coastal Act, and related Local Coastal Plan policies and regulations, creates land use priorities of visitor-serving facilities to enhance public opportunities for coastal recreation and access.
2023–2031 Housing Element
The 2023–2031 Housing Element of the City’s General Plan identifies Santa Barbara’s housing needs and establishes goals, policies, and programs to advance the City’s commitment to the production of affordable housing and sound community planning. City Council adopted the Housing Element on December 12, 2023, and the State Department of Housing and Community Development (HCD) certified that it is in substantial compliance with State Housing Element Law (Gov. Code, §65580 et seq) on February 13, 2024.
To facilitate increased housing production to better meet the City’s Regional Housing Needs Allocation (RHNA) of 8,001 new units over the next eight years and to affirmatively further fair housing, the City’s Housing Element includes 32 programs that are the core of the City’s Housing Strategy, translating goals and policies into actions. The purpose of this joint meeting is to guide implementation of two of the adopted Housing Element programs:
HE-1: Facilitate Conversion of Nonresidential Buildings to Housing HE-20: Evaluate Hotel Zones
HE-1: Facilitate Conversion of Nonresidential Buildings to Housing HE-1: Facilitate Conversion of Nonresidential Buildings to Housing is an implementation action focused on creating an adaptive reuse ordinance. Staff proposes a zoning ordinance to facilitate change-in-use from nonresidential to residential and requests feedback on which buildings/locations the ordinance should apply to. See Attachment 1 for the full program description from the Housing Element.
Background
Adaptive Reuse
Program HE-1 focuses on facilitating the conversion of existing buildings from nonresidential use to residential use, (e.g., office or retail to housing), which is commonly referred to as adaptive reuse. Additional General Plan Elements support adaptive reuse in their goals and policies, including Economic and Fiscal Health Policy EF12. Re-Use of Commercial Space and Historic Resources Policy HR4. Pursue Adaptive Reuse.
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
Adaptive reuse is the process of converting buildings that have outlived their original purpose to accommodate new uses. Commonly used to revitalize historic structures, adaptive reuse has become more attractive nationwide following the COVID-19 pandemic and the associated underutilization of existing nonresidential spaces intended for office or retail. Adaptive reuse is one method to increase housing supply and has been gaining popularity in response to high commercial vacancy rates and the need for housing.
Due to the city’s pyramid zoning1, the conversion of existing buildings from one use to another is frequent and widespread. At the City, this process is called a change-in-use.
Change-in-Use
Change-in-use is a process that varies in complexity depending on the existing building, site location, proposed new use, and area (square footage) being converted. Since the zoning standards are the same, converting a building from an existing nonresidential use to another nonresidential use (e.g., office to restaurant) is often easier than converting an existing nonresidential use to a new residential use. Projects pursuing a change-in-use from nonresidential to residential may require zoning modifications or concessions allowed under the State Density Bonus Law to reduce or eliminate certain residential development standards. In the city, requests for modifications or concessions are most commonly made for parking, open yard, or density allowances.
Recent examples of successful nonresidential to residential change-in-use projects include the converted building at 821 State Street from a solely nonresidential use to a mixed-use (nonresidential and residential) building providing 14 residential units. In 2021, two existing nonresidential buildings were converted to housing: at 16 West Mission Street, a nonresidential building was converted to create 23 residential units; and 1325 State Street was converted from solely commercial use to mixed-use (nonresidential and residential) providing two units. Currently going through entitlements is a project at 1514 Anacapa Street to convert an office building into four residential units. These projects and more have used the change-in-use process to adaptively reuse buildings in Santa Barbara.
In addition to an approved planning permit, all projects require a building permit.2 For adaptive reuse projects, the more stringent requirements imposed by the building code for fire and life safety, structural safety, and access compliance might pose considerable obstacles for change-in-use projects, separate from any zoning considerations. 1 Pyramid zoning categorizes uses into three general categories: residential, commercial, and industrial.
Arranged in a pyramid, residential zones in the pyramid’s top category only allow residential uses.
Commercial zones are in the middle category of the pyramid and allow both residential and commercial uses. Industrial zones typically allow residential, commercial, and industrial uses in the base category of the pyramid. In Santa Barbara, the Residential Single Unit (RS) zone is at the peak of the pyramid (allowing only one type of residential use) while the Manufacturing Commercial (M-C) zone is at the base, allowing residential, commercial, and industrial.
2 Most adaptive reuse projects require a planning permit. All projects require a building permit.
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
Potential Regulation Changes
For the new adaptive reuse ordinance, staff proposes streamlined zoning to simplify and encourage change-in-use from nonresidential to residential. The proposed changes would make converting nonresidential buildings to residential use as easy as converting from one nonresidential use to another, thus facilitating housing development in zones where both types of uses are allowed. Zoning reforms would involve changes to certain development standards, with many to remain unchanged. See Table 1 for a list of key development standards in the proposed adaptive reuse ordinance.
Table 1: Development Standards in an Adaptive Reuse Ordinance Standards Proposed to Change Standards Expected to Remain Unchanged Vehicle parking – maintain existing
parking, no additional required
Open yard – none required
Density – unlimited, except in
historic resources
Inclusionary housing requirements
Average unit size
Bicycle parking
Although the adaptive reuse ordinance has not been completed, staff did present a draft to Planning Commission in November 2021. Specific details and requirements will be discussed with Planning Commission and City Council when the Ordinance is presented for review.
At this time, staff is requesting direction from City Council and Planning Commission regarding the buildings to which the adaptive reuse ordinance would apply. The coastal zone is not included in this initial effort because changing vehicle parking requirements and increasing density beyond that established by the coastal land use designations conflicts with Coastal Land Use Plan policies and would require a Local Coastal Program amendment.
Proposed Applicability
Staff proposes that the adaptive reuse ordinance apply to the following existing structures:
Within Central Business District
100% affordable housing development
Designated historic resources
Hotel conversions
Staff does not propose that the adaptive reuse ordinance apply to the entire city. The focus on the Central Business District aligns with multiple planning regulations and policies already in place, and the desire to revitalize the downtown core by bringing residents to the area, including parking requirements, open yard regulations, and density allowances. Staff finds that it is an appropriate place to increase density within the shell of an existing structure without creating negative impacts on the area. Allowing reduced Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
or no parking, unlimited density, and reduced or no open yard in other areas of the city could have negative implications in those neighborhoods because they have different infrastructure and character. Although this is staff’s initial recommendation, if the program is successful, it could always be expanded to other areas of the city. It should also be noted that change-of-use from nonresidential to residential would still be allowed citywide, and modifications are available to reduce residential zoning standards, where deemed appropriate.
Within Central Business District. The Principles of Development in the City’s General Plan and the Average Unit-Size Density Incentive (AUD) Program, a zoning program enacted in 2013 to facilitate multi-unit housing under the General Plan, identify the Central Business District (“Downtown”)3 as an area in which to concentrate development. As such, the Central Business District is an ideal location to promote adaptive reuse projects for housing. In addition, current development standards related to vehicle parking, open yard, and density closely align with those considered for an adaptive reuse ordinance. Parking. At present, the Central Business District has the lowest vehicle parking requirements—none, in almost the entire area. Moreover, this is the only portion of the city with maximum parking limitations (1 per residential unit). Open yard. Open yard is regulated by zones, with commercial zones under the AUD Program providing the most flexibility in providing open yard for residential.
Additionally, the Central Business District is a more urban area where private open yard areas are not expected.
Density. The highest densities within the AUD Program are concentrated around the Central Business District with an objective to locate housing in areas most appropriate for higher quantities of units. Density in the Central Business District as part of the AUD Program’s Priority Housing Overlay is 63 dwelling units per acre (du/ac). Across the city, density allowances outside of the Priority Housing Overlay range from one du/ac (in the least-intense residential land use designation) to 36 du/ac in the High-Density tier of the AUD Program.
100% Affordable Housing Development. State law mandates adaptive reuse with minimum development standards for extremely affordable adaptive reuse projects (Assembly Bill 1490; 2023). Staff proposes to exceed State-required adaptive reuse development standards and allow adaptive reuse for any 100% low-income affordable housing development in the city. This aligns with existing concessions/development standard waivers allowed for state density bonus projects.
Designated Historic Resource. Historic resources may be adaptively reused with reduced parking requirements imposed under existing State law (California Health and Safety Code § 18962). Inclusion of historic resources in an adaptive reuse ordinance would include reduced standards for parking and open yard. Density increases are not proposed 3 Santa Barbara Municipal Code, Title 30, Figure 30.175.050.B, Central Business District Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
citywide for historic resources (unless located within the Central Business District), as that might have unintended neighborhood impacts where historic resources occur in lowdensity zones.
Hotel Conversions. Including buildings with an existing hotel use in the adaptive reuse ordinance can help rebalance local jobs and housing. Hotel buildings are uniquely positioned to convert to residential since they are designed for living with individual rooms and restrooms with plumbing throughout the structure. Typically, hotel sites provide adequate parking and may have shared open space or small private open space, but may not comply with existing regulations for density or residential open yard.
Direction for HE-1
Do City Council and Planning Commission agree with focusing the adaptive reuse ordinance on the following?
Within Central Business District
100% affordable housing development
Designated historic resources
Hotel conversions
HE-20: Evaluate Hotel Zones
HE-20: Evaluate Hotel Zones requires the City to identify and monitor trends in hotel development and review zones that allow hotel use in order to craft an ordinance and amendments that prioritize residential development over hotel development in appropriate areas. Staff requests feedback on proposed areas to modify hotel use regulations in the zoning ordinance. See Attachment 1 for the full program description from the Housing Element.
Background
Hotel Use Across the City
Santa Barbara is a popular tourist destination with its scenic natural setting, sunny climate, distinctive architectural style, and expansive beaches. The local economy depends, among many other sources, on tourism. In fact, the City’s recently adopted Fiscal Year 2025 budget relies on the transient occupancy tax (TOT) gathered from hotel room rentals.4 The city has approximately 3,379 existing hotel rooms, with 59 percent located in the coastal zone. Trends in planning applications for hotel use have steadily increased over the past five years while the number of hotel rooms being proposed overall peaked in 2019 and 2022. See Attachment 3 for more information on existing and proposed hotel uses.
4 The City’s Fiscal Year 2025 General Fund revenue is composed of multiple taxes, 16 percent, or $28.7 million, of which is from the transient occupancy tax.
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
The City of Santa Barbara classifies hotel use as a commercial use. Inland, 6 of the city’s 11 zones and one overlay zone allow hotel use. Of these, four zones permit hotel use by right, while the remaining two zones and one overlay zone allow hotel use with a Conditional Use Permit (CUP). A CUP sets additional restrictions and requirements for hotel use on a parcel. For instance, the Residential Multi-Unit (R-M) zone conditionally permits hotel use only if the proposed project is on a parcel with a designated Structure of Merit or Landmark. In essence, hotel use can be conditionally permitted on approximately three percent of parcels in the R-M zone due to the CUP requirements.5 See Table 2 below and Attachment 4 for zones that allow hotel use.
Short-term vacation rentals (STVRs) are defined as a hotel use in the city and are regulated the same as any other hotel use; however, at Council’s direction, staff is undertaking a separate work effort, in conjunction with the City Attorney’s Office, to develop a program to regulate STVRs in both the inland and coastal zones. As such, the below discussion does not focus on STVRs, and instead focuses solely on the traditional hotel model.
Table 2: Zones Where Hotel Use Is Allowed
Zone Notes
Inland (Title 30)
R-M Residential Multi-Unit Only allowed in a Historic Structure, and only with a CUP
R-MH Residential Multi-Unit and Hotel
O-R Office Restricted Only allowed in a Historic Structure, and only with a CUP
C-R Commercial Restricted
C-G Commercial General
M-C Manufacturing Commercial
RH Overlay Resort Hotel Overlay Requires a CUP
Residential use is allowed in all six inland zones that allow hotel use. Applicants have the choice for their project: a multi-unit residential development, a hotel development, another allowed use, or a combination of two or more uses.
The City’s General Plan prioritizes housing creation with many goals and policies supporting residential development, including Land Use Policies LG1. Resource Allocation Priority, LG4. Principles for Development, and LG6. Location of Residential Growth. The zoning ordinance implements the goals and policies of the General Plan. To fully prioritize residential use over hotel use, the ability to choose between these conflicting uses must be remedied in the zoning ordinance by removing or reducing the 5 In the R-M zone, 62 parcels include a Structure of Merit or Landmark.
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
allowance of hotel use in a zone that also allows residential use. This can be accomplished in a few ways:
Eliminate hotel use by right. Remove hotel uses as an allowed use in the zone. Allow hotel use with a CUP. Conditional zoning allows flexibility in case-by-case situations where hotel use may be appropriate (e.g., allowing a bed-andbreakfast in a landmark).
It should be noted that any zoning changes that affect allowed uses have the potential to affect land value, which could have financial repercussions for property owners.
Suitable Sites Inventory
The Housing Element includes a Suitable Sites Inventory to show the city has zoning capacity available to meet its housing need and accommodate RHNA. Identification of a suitable site in the Inventory merely proves the city has the capacity for residential unit development to meet and exceed RHNA under the current zoning regulations; identification of a site does not mean it will be developed as housing in the Housing Element planning cycle (2023–2031), nor does it limit development potential of nonresidential uses on the site.
In total, the certified 2023–2031 Housing Element identifies a capacity of 8,640 residential units, which demonstrates that the City meets and exceeds the RHNA with a buffer. The residential unit capacity identified to meet RHNA is located across the city with 89 percent of the total identified capacity (7,714 units) located in multi-unit zones in the inland area.
The remaining unit capacity includes accessory dwelling units (ADUs) without an identified location or on sites located in the coastal zone, which are excluded from this discussion.
The identified locations of the 7,714-unit capacity is in zones that allow both residential use and hotel use. See Table 3 for a breakdown of unit capacity in zones that allow hotel use.
Table 3: Residential Unit Capacity on Suitable Sites
in Inland Zones that allow Hotel Use6
Inland Zones Unit Capacity
R-M Residential Multi-Unit 3%
R-MH Residential Multi-Unit and Hotel 5%
O-R Office Restricted 1%
C-R Commercial Restricted 8%
C-G Commercial General 62%
M-C Manufacturing Commercial 21%
Total 7,714 units
6 Sites located in the coastal zone and ADUs are not included in this table.
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
Potential Regulation Changes
Staff is requesting direction from City Council and Planning Commission regarding the areas in inland portions of the city to eliminate hotel use or to require a CUP with the intent of limiting hotel use and prioritizing residential development.
Proposed Areas
Staff proposes five areas for zoning amendments to limit hotel use and thereby encourage residential use. See Attachment 6 for the Suitable Sites Inventory in the staff-proposed geographic areas.
Residential Multi-Unit (R-MH) Zone (5 percent of available unit capacity) o Rezone parcels from R-MH to Residential Multi-Unit (R-M) Manufacturing Commercial (M-C) Zone, excluding the State Street Master Plan area (18 percent of available unit capacity)
o Eliminate hotel as an allowed use
Milpas General Plan neighborhood (10 percent of available unit capacity) o Change regulations to require a CUP
Upper State General Plan neighborhood (36 percent of available unit capacity) o Change regulations to require a CUP
Priority Housing Overlay, excluding the State Street Master Plan area (78 percent of available unit capacity)
o Change regulations to require a CUP
By eliminating hotel use or requiring a CUP in the above proposed areas, approximately 88 percent7 of the residential unit capacity identified in the Suitable Sites Inventory would no longer compete as directly with potential hotel development.8 Direction for HE-20
Do City Council and Planning Commission agree with the below recommendations for limiting hotel use in the following areas?
Residential Multi-Unit and Hotels (R-MH) Zone (rezone to R-M) Manufacturing Commercial (M-C) Zone, excluding the State Street Master Plan area (eliminate)
Milpas General Plan Neighborhood (CUP required for hotel) Upper State General Plan Neighborhood (CUP required for hotel) 7 Removing hotel use as an allowed use would protect approximately 18 percent of potential capacity and requiring a CUP would protect 70 percent from competing with hotel development. 8 The total percentage of suitable sites that can be affected by potential regulation change is not a sum of each area. The proposed areas overlap and some suitable sites are counted in multiple areas. See Attachment 3 for detailed information.
Council Agenda Report
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
Priority Housing Overlay, excluding the State Street Master Plan area (CUP required for hotel)
Do City Council and Planning Commission agree with areas proposed to require a CUP versus eliminating the use altogether?
Next Steps
This joint meeting is an initial step in implementing Programs HE-1 and HE-20. The adopted and certified program timelines in the 2023–2031 Housing Element begin these programs this summer with anticipated completion in December 2025; however, staff will be working to complete them in advance of this timeline. City Attorney’s Office will require legal review and analysis of all draft ordinances. Both HE-1 and HE-20 will require action by Planning Commission, Ordinance Committee, and City Council for adoption.
BUDGET/FINANCIAL INFORMATION:
There is no budget or financial impact by giving direction to staff regarding the Housing Element program administration.
ATTACHMENTS: 1. 2023–2031 Housing Element Programs and Supporting General Plan Policies
2. Map: Adaptive Reuse – Downtown Considerations
3. Supporting Data
4. Map: Suitable Sites and Zoning That Allows Hotels
5. Map: Existing and Proposed Hotel Use
6. Map: Potential Hotel Regulation Changes
PREPARED BY: Dana Falk, Project Planner
SUBMITTED BY: Elias Isaacson, Community Development Director APPROVED BY: Kelly McAdoo, City Administrator
ATTACHMENT 1
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
2023-2031 HOUSING ELEMENT PROGRAMS
AND SUPPORTING GENERAL PLAN POLICIES
1 Housing Element Program HE-1: Facilitate Conversion of Nonresidential Buildings to Housing
The City has older commercial, office, and industrial buildings and larger single-unit residential buildings that are appropriate for conversion (i.e., adaptive reuse) to multi-unit or mixed-use residential. There are also historic buildings that could be converted to residential use or expanded to accommodate multiple residential units consistent with the Secretary of Interior’s Standards for Rehabilitation. The City will draft an Adaptive Reuse Ordinance for adoption, proposed to initially apply to existing buildings within the Central Business District (CBD), where there is sufficient transit and services, and existing buildings designated as a historic resource, where residential use is allowed.
The City shall prepare outreach materials, and online forms and applications to encourage adaptive reuse to property owners and interested developers.
Funding Source: General Fund (staff)
Responsibility: Planning Division
Time Frame: Start Date Q2 2024. End Date Q4 2025.
Corresponding Goal/Policy: Goal 1; Policies 1.1, 1.2, 1.3, 1.4, 1.7, and 1.8 Housing Element Program HE-20: Evaluate Hotel Zones
The City’s Zoning Ordinance allows both hotel and multi-unit residential and mixed uses in approximately 9.3 percent of the City. These areas are also permitted for legal shortterm rentals as discussed above. In recent years several projects that were initially proposed for multi-unit housing changed into applications for a hotel. Furthermore, a number of adaptive reuse projects have been converting commercial space to hotel use rather than residential. This had led to concern that the City’s available parcels for new infill development are not being prioritized for multi-unit housing over hotel use.
Similar to this trend, there is a concern that fractional ownership properties could proliferate and replace long term housing in residential areas. This type of ownership model is facilitated by professional companies that manage the sale, temporary use, and other aspects for non-primary owners. To date, one such property has been advertised in the City of Santa Barbara. Some cities and counties in California and elsewhere are adopting ordinances to prohibit fractional ownership or issuing Cease and Desist Orders against the companies purchasing homes for this use.
ATTACHMENT 1
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
2 To respond to these trends, the City will complete the following:
• Monitor Trends: Continue to track the proliferation of hotels and fractional ownership projects.
• Review Hotel Zones: Review zone districts that allow both hotel and residential use. Based on the review, the City shall prepare Zoning Ordinance amendments for adoption to consider a conditional use permit for some hotels, rezoning some areas of the City that allow both uses to reduce the conversion of residential uses to hotel uses, or other means to affirm a priority of residential development over hotel development in appropriate areas.
• Study Fractional Ownership: Study how other jurisdictions are responding to fractional ownership trends. Based on the study, the City shall prepare Zoning Ordinance amendments for adoption if warranted to protect long term housing stock.
Funding Source: General Fund (staff)
Responsibility: Community Development Department
Time Frame: Start Date Q2 2024. End Date Q4 2025.
Corresponding Goal/Policy: Goal 4; Policy 4.3
ATTACHMENT 1
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
3 Supporting General Plan Policies
Land Use Element
• LG1. Resource Allocation Priority.
Prioritize the use of available resources capacities for additional affordable housing for extremely low, very low, low, moderate, and middle income households over all other new development.
o LG1.1 Affordable Housing
o LG1.2 Available Resources
• LG4. Principles for Development.
Establish the following Principles for Development to focus growth, encourage a mix of land uses, strengthen mobility options and promote healthy active living. • LG6. Location of Residential Growth.
Encourage new residential units in multi-family and commercial areas of the City with the highest densities to be located in the Downtown, La Cumbre Plaza/Five Points area and along Milpas Street.
o LG6.1 Average Unit-Size Density Incentives Program
o LG6.3 Priority Housing Overlay
o LG6.7 Housing for Downtown Workers
• LG8. Manufacturing Uses.
Preserve and encourage the long-term integrity of light manufacturing uses. o LG8.1 Narrow Commercial Uses
o LG8.2 Limit Residential
2023-2031 Housing Element
• Policy 1.1 Sustainable and Livable Neighborhoods
Ensure that new housing programs, housing developments, and related infrastructure improvements include community-led strategies that encourage community revitalization in areas of lower opportunity to meet the needs of lowerincome residents and are consistent with the City’s sustainability initiatives for energy efficiency and active transportation goals.
• Policy 1.2: Infill Housing.
Encourage development of housing on infill sites near transit and jobs, particularly redevelopment of sites suitable for housing, while continuing to limit residential density in High Fire Hazard Areas.
ATTACHMENT 1
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
4 • Policy 1.3 Adaptive Reuse.
Provide incentives and promote flexibility for adaptive reuse projects that convert existing structures to multi-unit housing in order to reduce construction waste and extend the life of existing buildings.
• Policy 1.4 Reduce Constraints.
Reduce and, where feasible and practical, remove unnecessary City-imposed constraints that impede housing development.
• Policy 1.7 Prioritize Housing and Community Benefit.
Prioritize residential development and nonresidential priority projects with broad community benefit on sites zoned for both residential and other uses. • Policy 1.8 Flexible Standards.
Increase flexibility in multi-unit housing densities and other standards to allow a variety of unit sizes and affordability levels.
• Policy 4.3 Housing for Residents.
Promote occupancy of existing housing for residents through ordinances, zoning changes, and vacancy tax programs that limit practices such as short-term rentals, conversions to hotels, and prolonged vacancies.
Economic and Fiscal Health Element
• EF12. Re-Use of Commercial Space.
Provide incentives for adaptive re-use of vacant commercial buildings. • EF15. Protect Industrial Zoned Areas.
Preserve the industrial zones as a resource for the service trades, product development companies, and other industrial businesses not precluding priority housing in the C-M, Commercial Manufacturing Zone.
Historic Resources Element
• HR4. Adaptive Reuse.
Encourage the adaption of historic buildings or structures for uses other than the original intended use when the original use is no longer viable. o HR4.1 Provide Incentives
ATTACHMENT 1
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
5 Circulation Element
• 8.5 Downtown Housing.
The City shall promote/facilitate the development of housing to decrease the need for parking through an increased walking/biking population that lives, works, and shops Downtown (See Chapter 13).
• 13.2 Compact Development
Without increasing the City wide development potential as provided for in the existing Zoning Ordinance and General Plan, the City shall allow more compact, pedestrian oriented development along major transit corridors (see Traffic Standards Chapter, Implementation Strategy 11.1.1).
o 13.2.2 Consider amending the Zoning Ordinance
ATTACHMENT 2
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
SUPPORTING DATA
1 Hotel Use Data
Data on existing and proposed hotel use across the City was compiled from a variety of sources, to provide a foundation to evaluate hotel locations, quantities, and trends.
Existing Hotel Use
• The baseline data was initially gathered for the December 2011 Environmental Impact Report. In May 2024, staff updated the baseline data with hotel units and updated new hotel locations using the December 2018 Lower-Cost Overnight Accommodation Study for the Local Coastal Plan, recent hotel/short-term rental development tracked in Accela, OnBase plan record searches, and hotel websites. • The data includes the existing hotel room quantity for parcels with hotel use.
Proposed Hotel Use
• The dataset was generated from planning applications submitted to the Community Development Department for planning entitlements. This dataset is comprised solely of permits that proposed a change to hotel room quantity since 1996 to May 2024.
• This includes short-term rentals.
• Planning permits with the status of Application Rejected, Denied, Expired, Project Revised, Withdrawn are not included in this data.
• Not all permits reflected in the data have been constructed; those that have been constructed are included in the data and the built hotel rooms are also reflected in the hotel room quantities summarized in Existing Hotel Use. • The hotel room data is net new hotel rooms, as some projects propose to remove hotel rooms, while others propose to add new hotel rooms. Some years show a negative value of net new hotel rooms, meaning there are more hotel rooms proposed to be removed than new hotel rooms proposed to be built in that year.
Suitable Sites Inventory
The Suitable Sites Inventory was certified by the State Department of Housing and Community Development (HCD) as compliant with state law in February 2024. More information about the Suitable Sites Inventory is available in the 2023-2031 Housing Element.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
2 Existing Hotel Use
See Attachment 5 for a map of existing and proposed hotel use across the City.
Citywide
The compiled data identifies 3,379 hotel rooms in the City of Santa Barbara. Most hotel rooms (59 percent) are located in the coastal zone.
Table 1: Existing Hotel Rooms in Santa Barbara
Inland or Coastal Zone Hotel Rooms
Inland 1,400 41%
Coastal Zone 1,979 59%
Total 3,379 100%
Zones
See the Sectional Zoning Map of the City of Santa Barbara (Official Zoning Map) maintained by the City Clerk for all inland zones and Attachment 4 for a map of the inland zones that allow hotel use.
Most inland hotel rooms are located in the Commercial General (C-G) zone, closely followed by the Residential Multi-Unit and Hotel (R-MH) zone and the Commercial Restricted (C-R) zone.
Table 2: Existing Hotel Rooms in Inland Zones
Zones* Hotel Rooms
Inland
RS Residential Single-Unit 0 0%
R-2 ** Two-Unit Residential 92 7%
R-M Residential Multi-Unit 0 0%
R-MH Residential Multi-Unit and Hotel 365 26%
O-R Office Restricted 15 1%
O-M Office Medical 0 0%
C-R Commercial Restricted 318 23%
C-G Commercial General 446 32%
M-C Manufacturing Commercial 163 11%
M-I Manufacturing Industrial 1 <1%
P-R Parks and Recreation 0 0%
Inland Total 1,400 100%
* Overlay Zones and Specific Plan Zones not included.
** One parcel in the R-2 zone allows hotel use with a CUP because of the Resort Hotel Overlay.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
3 Neighborhoods
See the General Plan Land Use Element for a map of the City’s neighborhoods.
Half of the city’s existing (permitted) hotel rooms are located in two coastal zone neighborhoods – East Beach and West Beach. The majority of the remaining fifty percent are concentrated in inland neighborhoods of Lower State, Oak Park, and Upper East.
Table 3: Existing Hotel Rooms in Inland General Plan Neighborhoods General Plan Neighborhood Hotel Rooms
Inland
Alta Mesa 0 0%
Bel Air 0 0%
Campanil 0 0%
Cielito 0 0%
Downtown 97 7%
East Mesa 0 0%
East San Roque 0 0%
Eastside 0 0%
Eucalyptus Hill 0 0%
Foothill 0 0%
Hidden Valley 0 0%
Hitchcock 0 0%
Hope 0 0%
Laguna 26 2%
Lower East 5 <1%
Lower Riviera 0 0%
Lower State* 159 11%
Lower West 9 1%
Milpas 0 0%
Oak Park 338 24%
Riviera 92 7%
Samarkand 0 0%
San Roque 0 0%
Upper East 94 7%
Upper State 562 40%
West Downtown 18 1%
West Mesa 0 0%
Westside 0 0%
Inland Total 1,400 100%
* Portions of the Lower State General Plan neighborhood are in the coastal zone, including 204 hotel rooms counted in the Coastal Total.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
4 Priority Housing Overlay/State Street Master Plan
See the General Plan Land Use Element for a map of the Priority Housing Overlay.
The Priority Housing Overlay hosts nine percent of all existing hotel rooms. The State Street Master Plan area is completely within the Priority Housing Overlay.
Table 4: Existing Hotel Rooms in the Priority Housing Overlay and State Street Master Plan area
Area Hotel Rooms
Inland
Priority Housing Overlay 302 22%
State Street Master Plan area* 252 18%
Sites not in the Priority Housing Overlay 1,098 78%
Inland Total 1,400 100%
* The State Street Master Plan area is entirely within the Priority Housing Overlay.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
5 Proposed Hotel Use
See Attachment 5 for a map of existing and proposed hotel use across the City.
Unlike existing hotel use data, proposed hotel use is organized to identify recent trends in planning permit (PLN) applications received from 2019 to 2023.
Citywide
PLN applications with a change in hotel use have been increasing over the past five years, as shown in Figure 1.
As shown in Figure 2, PLN applications over the past five years have consistently proposed to increase the quantity of hotel rooms in the City.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
6 ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
7 Zones
See the Sectional Zoning Map of the City of Santa Barbara (Official Zoning Map) maintained by the City Clerk for the zones and Attachment 4 for a map of the inland zones that allow hotel use.
In the past five years, the inland zone Commercial General (C-G) has been most prevalent for net new hotel room proposals. Overall, the coastal zone dominated the total quantity of proposed net new hotel rooms over the past five years, with 369 net new hotel rooms overall. As shown in Figure 3, the coastal zone is receiving fewer proposed net new hotel rooms in recent years, with inland areas of the city receiving the majority of proposed net new hotel rooms since 2020.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
8 Neighborhoods
See the General Plan Land Use Element for a map of the City’s neighborhoods.
Proposed hotel use has been concentrated in the inland General Plan neighborhoods of Downtown, Laguna, Lower State, and Oak Park over the past five years, as shown in Figure 4.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
9 Priority Housing Overlay/State Street Master Plan
See the General Plan Land Use Element for a map of the Priority Housing Overlay.
Proposed hotel use in the Priority Housing Overlay has increased with spikes in 2020 and 2022, as shown in Figure 5.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
10 Suitable Sites Inventory
For a full explanation of the Suitable Sites Inventory, see the 2023-2031 Housing Element.
Table 5: 2023-2031 Housing Element*
Residential Unit Capacity by Income Category
Very Low
0-50%
AMI
Low
50-80%
AMI
Moderate
80-120%
AMI
Above Moderate
120+%
AMI
Total
Total Capacity 2,342 1,466 1,731 3,101 8,640
RHNA 2,147 1,381 1,441 3,032 8,001
* The Suitable Sites Inventory was updated in January 2024 per HCD request during the certification process; the unit capacity differs from those shown in the Counciladopted 2023-2031 Housing Element.
Table 6: Residential Unit Capacity
identified in the 2023-2031 Housing Element
Unit Capacity Unit Capacity
Suitable Sites located Inland 7,714 89%
Suitable Sites in the Coastal Zone and ADUs 926 11%
Total 8,640 100%
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
11 Zones
See the Sectional Zoning Map of the City of Santa Barbara (Official Zoning Map) maintained by the City Clerk for the zones.
Almost two thirds of residential unit capacity occurs in the Commercial General zone.
Table 7: Residential Unit Capacity
identified on Suitable Sites in Inland Zones
Zones* Unit Capacity
Inland
RS Residential Single-Unit 3 <1%
R-2 ** Two-Unit Residential 4 <1%
R-M Residential Multi-Unit 270 3%
R-MH Residential Multi-Unit and Hotel 376 5%
O-R Office Restricted 91 1%
O-M Office Medical 0 0%
C-R Commercial Restricted 598 8%
C-G Commercial General 4,756 62%
M-C Manufacturing Commercial 1,616 21%
M-I Manufacturing Industrial 0 0%
P-R Parks and Recreation 0 0%
Inland Total 7,714 100%
*Overlay Zones and Specific Plan Zones not included.
**One parcel in the R-2 zone allows hotel use with a CUP because of the Resort Hotel Overlay.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
12 Neighborhoods
See the General Plan Land Use Element for a map of the City’s neighborhoods.
One third of inland residential capacity is identified in the Upper State neighborhood.
Table 8: Residential Unit Capacity
identified on Suitable Sites in Inland General Plan Neighborhoods General Plan Neighborhood Unit Capacity
Alta Mesa 0 0%
Bel Air 0 0%
Campanil 1 <1%
Cielito 0 0%
Downtown 678 9%
East Mesa 0 0%
East San Roque 0 0%
Eastside 36 <1%
Eucalyptus Hill 0 0%
Foothill 1 <1%
Hidden Valley 0 0%
Hitchcock 17 <1%
Hope 15 <1%
Laguna 582 8%
Lower East 970 13%
Lower Riviera 49 <1%
Lower State* 454 6%
Lower West 43 <1%
Milpas 765 10%
Oak Park 225 3%
Riviera 1 <1%
Samarkand 0 0%
San Roque 0 0%
Upper East 207 3%
Upper State 2,805 36%
West Downtown 799 10%
West Mesa 0 0%
Westside 43 <1%
Inland Total 7,714 100%
* Portions of these General Plan neighborhood are in the coastal zone. The unit capacity identified in the coastal zone is not included in this table.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
13 Priority Housing Overlay/State Street Master Plan
See the General Plan Land Use Element for a map of the Priority Housing Overlay.
Over three quarters of unit capacity is identified within the Priority Housing Overlay.
Table 9: Residential Unit Capacity
identified on Suitable Sites in the Suitable Sites Inventory in the Priority Housing Overlay and State Street Master Plan project area, Inland Area Unit Capacity
Priority Housing Overlay
excluding State Street Master Plan area
6,013 78%
Sites not in the above listed area 1,701 22%
Inland Total 7,714 100%
*The State Street Master Plan area is entirely within the Priority Housing Overlay ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
14 Areas for Potential Hotel Regulation Changes
Residential Multi-Unit and Hotel (R-MH) Zone
The Residential Multi-Unit and Hotel (R-MH) zone allows both residential use and hotel use. This zone hosts 26 percent of existing inland hotel rooms. There are 27 suitable sites with a capacity of 376 residential units in the R-MH zone.
Staff proposes rezoning R-MH parcels to the R-M Residential Multi-Unit Zone. A CUP would be required and would reduce the available parcels for hotel use from 1,226 parcels to 103 parcels, a reduction of 92 percent, and may affect five percent of the Suitable Sites Inventory capacity.
Manufacturing Commercial (M-C) Zone, excluding the State Street Master Plan area The Manufacturing Commercial (M-C) zone allows both residential use and hotel use.
This zone hosts 12 percent of the existing inland hotel rooms. There are 72 suitable sites with a capacity of 1,394 residential units in the M-C zone, excluding the State Street Master Plan area.
Staff proposes restricting hotel use in the M-C zone, excluding the State Street Master Plan area, by removing hotel use as an allowed use. This would affect 18 percent of the Suitable Sites Inventory capacity.
Milpas General Plan Neighborhood
The Milpas neighborhood is almost entirely comprised of zones (R-M, C-R, and C-G) that allow residential and hotel use (92 percent), with the remaining eight percent not allowing hotel use (R-2 and M-I). This neighborhood hosts no existing hotel. There are 44 suitable sites with a capacity of 765 residential units in the Milpas neighborhood.
Staff proposes restricting hotel use in the Milpas neighborhood by requiring a CUP for hotel use. This would affect 10 percent of the Suitable Sites Inventory capacity.
Upper State General Plan Neighborhood
The Upper State neighborhood is mostly comprised of zones (R-M, R-MH, O-R, C-R, and C-G) that allow residential and hotel use (80 percent), with the remaining 20 percent not allowing hotel use (RS, R-2, and P-R). This neighborhood hosts 40 percent of the existing inland hotel rooms. There are 50 suitable sites with a capacity of 2,805 residential units in the Upper State neighborhood.
Staff proposes restricting hotel use in the Upper State neighborhood by requiring a CUP for hotel use. This would affect 36 percent of the Suitable Sites Inventory capacity.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
15 Priority Housing Overlay, excluding the State Street Master Plan area The Priority Housing Overlay concentrates higher-density residential development in areas of the City identified as priority for housing in the Average Unit-Size Density Incentive Program. The State Street Master Plan project area is excluded from the Priority Housing Overlay area that is proposed for hotel use restrictions. The resultant area is fully composed of zones (R-M, R-MH, O-R, C-R, C-G, M-C) that allow residential and hotel use, with 7% of that conditionally allowing hotel use (R-M and O-R). This area hosts four percent of the existing inland hotel rooms. There are 242 suitable sites with a capacity of 6,013 residential units in this area.
Staff proposes restricting hotel use by requiring a CUP for hotel use. This would affect 78 percent of the Suitable Sites Inventory capacity.
All Areas
In total, 88 percent of the residential unit capacity identified in the Suitable Sites Inventory may be affected from development of a hotel use by removing or reducing allowed hotel use in the proposed areas.1 See Table 10 and Attachment 6 for the Suitable Sites Inventory in the staff-proposed areas for potential hotel regulation changes.
Table 10: Residential Unit Capacity
identified on Suitable Sites
Preserved with Potential Hotel Regulation Changes
Area Unit Capacity
Residential Multi-Unit and Hotels (R-MH) 376
Manufacturing Commercial (M-C),
excluding the State Street Master Plan area
1,394
Milpas General Plan neighborhood 765
Upper State General Plan neighborhood 2,805
Priority Housing Overlay,
excluding the State Street Master Plan area
6,013
Sites in multiple areas (see Table 11)2 (4,544)
Unit Capacity affected by potential regulation changes 6,809 units 1 The total percentage of suitable sites that can be affected by potential regulation change is not a sum of each area. The proposed areas overlap and some suitable sites are counted in multiple areas. See Table 11 for overlapping areas and unit capacities.
2 Unit Capacity located in multiple areas subtracted from the summation of all area unit capacities to remove quantities that are counted in more than one area.
ATTACHMENT 3
Joint City Council and Planning Commission Work Session: Direction on Housing Element Program Implementation
July 26, 2024
16 Table 11: Residential Unit Capacity
identified on Suitable Sites in the Suitable Sites Inventory in Multiple Areas Preserved with Potential Hotel Regulation Changes Area Unit
Capacity
Priority Housing Overlay and R-MH 324
Priority Housing Overlay and M-C 1,367
Priority Housing Overlay and Milpas 733
Priority Housing Overlay and Upper State 2,109
R-MH and Upper State 11
Sites in multiple areas 4,544
ATTACHMENT 4
ATTACHMENT 5
ATTACHMENT 6