Agenda packet, first session — Santa Barbara City Council, October 6, 2026 (part 1 of 2)

CITY OF SANTA BARBARA

CITY COUNCIL
Randy Rowse
Mayor
Kelly McAdoo
City Administrator
Kristen W. Sneddon
Mayor Pro Tempore
Oscar Gutierrez
Ordinance Committee Chair
John S. Doimas
City Attorney
Eric Friedman
Finance Committee Chair
Meagan Harmon
Mike Jordan
Wendy Santamaria
City Hall
735 Anacapa Street
http://www.SantaBarbaraCA.gov
OCTOBER 6, 2026, 2:00 PM
AGENDA
IN-PERSON PUBLIC COMMENT: At the beginning of each meeting of the City Council, Finance Committee, or Ordinance Committee, any member of the public may address the City Council concerning any item not on the Council's agenda. Any person wishing to make such address should first complete and deliver a "Request to Speak" form prior to the time that public comment is taken up by the City Council. Each speaker will be given a total of 3 minutes to address the Council. Pooling of time is not allowed during general public comment. The time allotted for general public comment at the beginning of the 2:00 p.m. session is 30 minutes.

Any member of the public who did not speak during the 2:00 p.m. session but who submitted a request to do so during the 2:00 p.m. 30 minute session may do so at the end of the meeting when the additional “Public Comment (If Necessary)” is announced. The City Council, upon majority vote, may decline to hear a speaker on the grounds that the subject matter is beyond their jurisdiction.

REMOTE PUBLIC COMMENT: Members of the public wishing to speak must “raise their hand” in the Zoom platform by selecting the virtual hand icon when their item is called. The keyboard shortcut for this is Alt+Y for Windows and Option+Y for Macs. City staff will activate the speaker’s microphone when the speaker’s name is called. The speaker will then need to unmute themselves. The keyboard shortcut for this is Alt+M for Windows or Command-Shift-A for Macs.

HOW TO REMOTELY OBSERVE AND/OR SPEAK LIVE AT A MEETING
• Web: https://santabarbaraca-gov.zoom.us/j/89359334270 (Participation via Zoom) • Telephone: Dial 1-669-900-6833, Enter Webinar ID: 893 5933 4270 (press *9 to raise/lower hand; press *6 to mute/unmute) • Online Streaming: Council meetings are streamed live at www.SantaBarbaraCA.gov/CAP • TV: Each regular City Council meeting is broadcast live in English and Spanish on City TV Channel 18 and rebroadcast in English on Wednesdays and Thursdays at 7:00 p.m. and Saturdays at 8:00 a.m., and in Spanish on Sundays at 3:00 p.m.

Each televised Council meeting is closed captioned for the hearing impaired. Check the City TV program guide at www.santabarbaraca.gov/citytv for rebroadcasts of Finance and Ordinance Committee meetings.

WRITTEN PUBLIC COMMENT: Public comments may also be submitted via email to [email protected] prior to the beginning of the Council Meeting. All public comments submitted via email will be provided to City Council and will become part of the public record.
(CONTINUED ON NEXT PAGE)
ORDER OF BUSINESS: Regular meetings of the Finance Committee and the Ordinance Committee begin at 12:00 p.m. The regular City Council meeting begins at 2:00 p.m. in the Council Chambers at City Hall.

REPORTS: Copies of the reports relating to agenda items are available for review at http://www.SantaBarbaraCA.gov/CAP.In accordance with state law requirements, this agenda generally contains only a brief general description of each item of business to be transacted or discussed at the meeting. Should you wish more detailed information regarding any particular agenda item, you are encouraged to obtain a copy of the Council Agenda Report (a "CAR") online at the City's website (http://www.SantaBarbaraCA.gov/CAP). Materials related to an item on this agenda submitted to the City Council after distribution of the agenda packet are posted to the City’s website as soon as reasonably feasible.

CONSENT CALENDAR: The Consent Calendar is comprised of items that will not usually require discussion by the City Council. A Consent Calendar item is open for discussion by the City Council upon request of a Councilmember, City staff, or member of the public. Items on the Consent Calendar may be approved by a single motion. Should you wish to comment on an item listed on the Consent Agenda, after turning in your "Request to Speak" form, you should come forward to speak or raise your hand in Zoom at the time the Council considers the Consent Calendar.

LANGUAGE TRANSLATION AND INTERPRETATION: The City of Santa Barbara offers live Spanish translation and interpretation for City Council Meetings via the Wordly platform. Follow the directions below to access the service. • Go to: https://attend.wordly.ai/join/QQBV-6746
o Ensure the Session ID QQBV-6746 is displayed.
o Select “Spanish” and click on the “Attend” button.
o You can now read the captions on your device and/or listen to the translation of the City Council meeting. o Click the speaker button to hear a text-to-speech version of the translated dialogue. • If you have any questions or concerns, please contact City TV at 805-564-5311.

SPANISH INTERPRETATION: If you need interpretation of your communications to Council from Spanish into English, please contact the City Clerk’s Office at 564-5309 or by email at [email protected]. If possible, notification of at least 48 hours will usually enable the City to make arrangements.

INTERPRETACIÓN EN ESPAÑOL: Si necesita una interpretación del español al inglés, para sus comunicaciones al Consejo, comuníquese con la Oficina del Secretario Municipal al 564-5309, o por correo electrónico a [email protected]. Si es posible, la notificación de al menos 48 horas generalmente permitirá a la Ciudad hacer los arreglos.

AMERICANS WITH DISABILITIES ACT: If you need auxiliary aids or services or staff assistance to attend or participate in this meeting, please contact the City Administrator's Office at 564-5305 or by email at [email protected]. If possible, notification at least 48 hours prior to the meeting will usually enable the City to make reasonable arrangements. For those who need accessibility accommodation in using the “raise hand” function and/or registering to participate in the Zoom session, please contact the Clerk’s office by 5:00 p.m. the day before the meeting for assistance. Additionally, a speaker may email [email protected] by 5:00 p.m. the day before a meeting, stating which item they wish to speak on. Specialized services, such as sign language interpretation or documents in Braille, may require additional lead time to arrange. 10/06/2026 Santa Barbara City Council Final Agenda Page 1 OCTOBER 6, 2026 AGENDA
ORDINANCE COMMITTEE MEETING - 12:00 P.M. IN THE COUNCIL CHAMBER

1. Subject: Inclusionary Housing Ordinance Amendments (CITY2026-00003) Recommendation: That Ordinance Committee:

A. Review and forward to City Council ordinance amendments to amend Section 25.02.030, Section 26.80.030, Chapter 28.43, Section 30.15.050, Sections 30.150.020 and 30.150.080, Chapter 30.160, Section 30.185.045, Sections 30.300.010, 30.300.080, 30.300.120, 30.300.180, and

30.300.190, and delete Sections 30.150.110, 30.150.120, 30.150.130,

30.150.140, and 30.150.150 related to Inclusionary Housing Requirements; B. Determine that the inclusionary housing ordinance amendments do not require further California Environmental Quality Act (CEQA) review pursuant to CEQA Guidelines Sections 15162 and 15168; and C. Determine that the inclusionary housing ordinance amendments are consistent with the General Plan and City Charter.
10/06/2026 Santa Barbara City Council Final Agenda Page 2 REGULAR CITY COUNCIL MEETING - 2:00 P.M.

CALL TO ORDER

PLEDGE OF ALLEGIANCE

ROLL CALL

CEREMONIAL ITEMS

1. Subject: Breast Cancer Awareness Month

2. Subject: National Arts & Humanities Month

3. Subject: Employee Recognition – Service Award Pins
Recommendation: That Council authorize the City Administrator to express the City’s appreciation to employees who are eligible to receive service award pins for their years of service through October 31, 2026.

CHANGES TO THE AGENDA

CONSENT CALENDAR

4. Subject: Waiver of Reading in Full of Ordinances and Resolutions Recommendation: That Council waive the reading in full of all ordinances and resolutions on the agenda and authorize introduction or adoption by reading title only, pursuant to City Charter Section 511, unless otherwise requested by a member of the City Council; this waiver shall not apply to emergency ordinances, which shall be read in full as required by Section 511.

5. Subject: Adoption of Ordinance Amending the Santa Barbara Municipal Code to Establish Residential Rent Stabilization and Residential Rental Registry Programs [Ordinance Adoption]
Recommendation: That Council adopt, by reading of title only, an Ordinance Amending the Santa Barbara Municipal Code to Establish Residential Rent Stabilization and Residential Rental Registry Programs. 10/06/2026 Santa Barbara City Council Final Agenda Page 3

6. Subject: Authorize the City Administrator to Execute a Local Housing Trust Fund Loan for the Acquisition of Land by People’s Self-Help Housing Related to the Carrillo Street Apartments Project [Ordinance Introduction; Resolution; Agreement]
Recommendation: That Council:

A. Authorize the City Administrator to execute a Local Housing Trust Fund Loan Agreement for a term of 55 years for the acquisition of land with People’s Self-Help Housing;
B. Introduce and subsequently adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Approving a Loan Agreement with People’s Self-Help Housing in the Amount of $1,945,176 for Land Acquisition of the Real Property Located at 312 W Carrillo Street, 316 W Carrillo Street, and 1018 Placido Avenue, to be Used for Permanent Affordable Housing, to be Secured by a Deed of Trust and a 55-Year Affordability Control Covenant Imposed on Real Property, and Authorizing the City Administrator to Execute such Agreements, Subject to Approval as to Form by the City Attorney;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 26-057, Adopting the Budget for Fiscal Year 2027, to Approve an Increase in Expenditure Appropriations in the Local Housing Trust Fund in the Amount of $1,945,176, to Fund a Loan Agreement with People’s Self Help Housing for the Acquisition of Property for Affordable Housing Development at 312 W Carrillo Street, 316 W Carrillo Street, and 1018 Placido Avenue; and
D. Read the titles of the Ordinances and Resolutions and, if there is no objection from any Councilmember present, waive further reading pursuant to Section 511 of the Santa Barbara City Charter.

7. Subject: Advocacy Positions of Support for Proposition 1 and Opposition to Propositions 43 and 45 on the November 3, 2026 Statewide General Election Ballot [Resolution]
Recommendation: That Council:

A. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara in Support of Proposition 1, the Veterans and Affordable Housing Bond Act of 2026, on the November 3, 2026 Statewide General Election Ballot;
B. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara in Opposition to Proposition 43, Relating to Local Special Taxes and the Two-thirds Vote Requirement, on the November 3, 2026 Statewide General Election Ballot; and
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara in Opposition to Proposition 45, Relating to Environmental Review for Certain Projects, on the November 3, 2026 Statewide General Election Ballot.
10/06/2026 Santa Barbara City Council Final Agenda Page 4

8. Subject: Renaming of Calle César Chávez to Limuw Street [Resolution] Recommendation: That Council adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Renaming All of Calle César Chávez Between East Gutierrez Street and East Cabrillo Boulevard to Limuw Street.

9. Subject: Approval of Mills Act Historic Property Tax Reduction Contracts [Agreement]
Recommendation: That Council:

A. Grant exceptions to the Mills Act contract threshold for assessed property valuation, pursuant to Santa Barbara Municipal Code §30.157.145.C.4.m., for the following historic properties:
• 1730 Anacapa Street (APN 027-111-015);
• 2025 Plaza Bonita (APN 025-281-034);
• 1809 Mira Vista Avenue (APN 019-090-026);
• 1609 Garden Street (APN 027-192-012);
B. Grant renewals of the Mills Act contracts for the following historic properties:
• 809 West Pedregosa Street (APN 043-151-007);
• 1116 Garden Street (APN 029-172-001);
• 1919 Santa Barbara Street (APN 025-381-007);
• 2210 Hudson Drive (APN 041-326-006);
• 2121 Garden Street (APN 025-252-003); and
C. Authorize the Community Development Director to execute the four new Mills Act historic property contracts and to renew the five existing contracts.

10. Subject: First Amendment to Agreement Number 30015 with EcoTierra Consultant RRM Design Group for the Reimagining Franceschi House Project [Agreement]
Recommendation: That Council authorize the Parks and Recreation Director to execute a First Amendment to Agreement No. 30015 to provide professional environmental consulting and documentation for the Reimagining Franceschi House Project (Project).

11. Subject: Agreement with Santa Barbara County Sheriff’s Office for Law Enforcement Services during Annual Fiesta Events [Agreement] Recommendation: That Council authorize the Chief of Police or their designee to execute a three-year agreement with the Santa Barbara County Sheriff’s Office to provide law enforcement services during Annual Fiesta Events, with an expiration date of September 1st, 2028.

REPORT FROM THE ORDINANCE COMMITTEE
10/06/2026 Santa Barbara City Council Final Agenda Page 5

GENERAL PUBLIC COMMENT

PULLED CONSENT ITEMS

CITY COUNCIL ADMINISTRATIVE AND ATTORNEY REPORTS

PUBLIC WORKS DEPARTMENT

12. Subject: Access Advisory Committee - Annual Report
Recommendation: That Council receive an update on the recent activities and achievements of the Access Advisory Committee.

COMMUNITY DEVELOPMENT DEPARTMENT

13. Subject: Short-Term Rental Program Ordinances [Ordinance Introduction; Resolution]
Recommendation: That Council:

A. Introduce and subsequently adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Amending Santa Barbara Municipal Code Title 30 (Inland Zoning Ordinance) to add Section 30.185.395 ShortTerm Rentals and amend Sections 30.25.020, 30.30.020, 30.155.040,

30.175.090, 30.185.220, 30.295.020, 30.295.040, 30.300.080 H,

30.300.160 P, and 30.300.180 R Pertaining to Regulations for Short-Term Rentals and Homeshares;
B. Introduce and subsequently adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Amending Santa Barbara Municipal Code Title 28 (Coastal Zoning Ordinance) to add Chapter 28.91 Short-Term Rentals and amend Sections 28.88.028 and 28.90.045 Pertaining to Regulations for Short-Term Rentals and Homeshares;
C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Approving a Local Coastal Program Amendment (CITY2026-00001) to Add Chapter 28.91 Short-Term Rentals and Amend Sections 28.88.028 and 28.90.045 of Title 28 of the Municipal Code Pertaining to Regulations for Short-Term Rentals and Homeshares; D. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending the City of Santa Barbara Schedule of Penalties, Fees, And Service Charges to Add Short-Term Rental Program Fees; E. Determine that the Short-Term Rental Program is exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15168 061(b)(3) and was conducted as part of the Housing Plan Program EIR (SCH2022040209) certified on August 11, 2026; and F. Determine that the Short-Term Rental Ordinances are consistent with the General Plan, Local Coastal Plan (LCP), and City Charter. 10/06/2026 Santa Barbara City Council Final Agenda Page 6

COUNCIL AND STAFF COMMUNICATIONS

COUNCILMEMBER COMMITTEE ASSIGNMENT REPORTS & ENGAGEMENTS

PUBLIC COMMENT (IF NECESSARY)

ADJOURNMENT

CITY OF SANTA BARBARA

ORDINANCE COMMITTEE MEETING

MEETING AGENDA
DATE: October 6, 2026 Oscar Gutierrez, Chair
TIME: 12:00 p.m. Mike Jordan
PLACE: Council Chambers Kristen Sneddon
Office of the City Office of the City
Administrator Attorney
Kelly McAdoo John Doimas
City Administrator, City Administrator’s Office City Attorney Nicole Grisanti
Manager, City Administrator’s Office

ITEM FOR CONSIDERATION
SUBJECT: Inclusionary Housing Ordinance Amendments
RECOMMENDATION: That the Ordinance Committee:

A. Review and forward to City Council ordinance amendments to amend Section

25.02.030, Section 26.80.030, Chapter 28.43, Section 30.15.050, Sections

30.150.020 and 30.150.080, Chapter 30.160, Section 30.185.045, Sections

30.300.010, 30.300.080, 30.300.120, 30.300.180, and 30.300.190, and delete Sections 30.150.110, 30.150.120, 30.150.130, 30.150.140, and 30.150.150 related to Inclusionary Housing Requirements;
B. Determine that the inclusionary housing ordinance amendments do not require further California Environmental Quality Act (CEQA) review pursuant to CEQA Guidelines Sections 15162 and 15168; and
C. Determine that the inclusionary housing ordinance amendments are consistent with the General Plan and City Charter.

IN-PERSON PUBLIC COMMENT: Any person wishing to address the Ordinance Committee should first complete and deliver a "Request to Speak" form prior to the time that public comment is taken up by the Committee Member. Each speaker will be given a total of 3 minutes to address the Committee. The Ordinance Committee, upon majority vote, may decline to hear a speaker on the grounds that the subject matter is beyond their jurisdiction.

WRITTEN PUBLIC COMMENT: Public comments may also be submitted via email to [email protected] prior to the beginning of the Ordinance Committee Meeting. All public comments submitted via email will be provided to the Ordinance Committee and will become part of the public record.

HOW TO REMOTELY OBSERVE AND/OR SPEAK LIVE AT A MEETING:
• WEB: https://santabarbaraca-gov.zoom.us/j/83099911799?pwd=N0fwX914FLbpUNNMPr2foEbiub5ovC.1 Passcode: 199458
• TELEPHONE: Phone one-tap:
+16699006833,,83099911799# US (San Jose)
+16694449171,,83099911799# US
LANGUAGE TRANSLATION AND INTERPRETATION: The City of Santa Barbara offers live Spanish translation and interpretation for City Council Meetings via the Wordly platform. Follow the directions below to access the service. • Go to: https://attend.wordly.ai/join/QQBV-6746
o Ensure the Session ID QQBV-6746 is displayed.
o Select “Spanish” and click on the “Attend” button.
o You can now read the captions on your device and/or listen to the translation of the City Council meeting. o Click the speaker button to hear a text-to-speech version of the translated dialogue. • If you have any questions or concerns, please contact City TV at 805-564-5311.

AMERICANS WITH DISABILITIES ACT: If you need auxiliary aids or services or staff assistance to attend or participate in this meeting, please contact the City Administrator's Office at 564-5305 or by email at [email protected] if possible, notification at least 48 hours prior to the meeting will usually enable the City to make reasonable arrangements. For those who need accessibility accommodation in using the “raise hand” function and/or registering to participate in the Zoom session, please contact the Clerk’s office by 5:00 p.m. the day before the meeting for assistance. Additionally, a speaker may email [email protected] by 5:00 p.m. the day before a meeting, stating which item they wish to speak on. Specialized Services, such as sign language interpretation or documents in Braille, may require additional lead time to arrange.

CITY OF SANTA BARBARA
Council Agenda Report
Agenda Date: October 6, 2026
To: Ordinance Committee
From: Community Development Department
Subject: Inclusionary Housing Ordinance Amendments (CITY2026-00003) Recommendation:

That Ordinance Committee:

30.300.180, and 30.300.190, and delete Sections 30.150.110, 30.150.120, 30.150.130,

30.150.140, and 30.150.150 related to Inclusionary Housing Requirements; B. Determine that the inclusionary housing ordinance amendments do not require further California Environmental Quality Act (CEQA) review pursuant to CEQA Guidelines Sections 15162 and 15168; and
C. Determine that the inclusionary housing ordinance amendments are consistent with the General Plan and City Charter.

Executive Summary
The proposed inclusionary housing ordinance amendments implement recommendations from the Inclusionary Housing and In-Lieu Fee Study with a goal of updating and simplifying the City’s existing inclusionary housing requirements to improve housing feasibility and support affordable housing. Inclusionary housing is a zoning standard that requires a set percentage of residential units in a development to be restricted as affordable units.

Amendments are proposed to Titles 25, 26, 28, and 30 of the Santa Barbara Municipal Code (Attachment 1), the Fee Schedule, and the Affordable Housing Policies and Procedures. The proposed amendments support 2023–2031 Housing Element Goal 1: Create New Housing and Goal 2: Prioritize Affordable Housing and is the final implementation component of Housing Element Program HE-13 Evaluate Inclusionary Housing Ordinances.

Agenda Item No. 1
Council Agenda Report
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Discussion
Background
The City of Santa Barbara uses a broad range of tools to support affordable housing development, including strategies such as the use of City-owned land for projects like Jacaranda Court and leveraging local, state, and federal resources to provide loans and grants for new affordable units, as seen in projects like 15 South Hope and Parma Court. The City also facilitates use of density bonuses and development concessions to incentivize affordable production, and administers the Average Unit-Size Density Incentive (AUD) program to encourage compact rental housing near transit. Additionally, City Council adopted an adaptive reuse ordinance to streamline the conversion of older commercial buildings into housing.

Together, these mechanisms enable the City to expand, preserve, and promote affordable housing across a wide range of income levels. The Inclusionary Housing Ordinance is another key tool that supports affordable housing production.

Inclusionary housing is a zoning standard requiring deed-restricted units to be affordable to households in specified income categories as part of a market rate residential development.

The City has inclusionary housing requirements for both ownership (adopted in 2004 for Middle-Income households) and rental (adopted in 2019 for Moderate-Income households) residential developments to promote the creation of affordable housing.

The proposed inclusionary housing ordinance amendments implement 2023–2031 Housing Element Program HE-13: Evaluate Inclusionary Housing Ordinances and support the Housing Element’s first two goals—Create New Housing and Prioritize Affordable Housing.

Inclusionary Housing and In-Lieu Fee Study
The Inclusionary Housing and In-Lieu Fee Study (Study, available on the Inclusionary Housing Requirements webpage SantaBarbaraCA.gov/Inclusionary-Housing-Requirements) evaluated the City’s existing inclusionary housing requirements with a feasibility study to assist the City in considering changes that support the Housing Element’s housing production and affordable housing goals. The 10 Study recommendations, all supported by staff, attempt to strike a balance that meets affordable housing goals while not constraining the production of housing.

See Attachment 2 for a summary of the Study’s recommendations.

Community Engagement and Public Hearings
Community engagement and public hearings have shaped staff's approach to the inclusionary housing ordinance amendments. Community input informed the Study, while Planning Council Agenda Report
Inclusionary Housing Ordinance Amendments (CITY2026-00003)

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Commission and City Council feedback on the Study recommendations informed the ordinance amendments. Additional community input influenced the drafting of the proposed ordinance amendments.

On April 16, 2026, the Planning Commission supported all of the Study recommendations, some with revisions. Planning Commission guidance and support are described for each recommendation in Attachment 2.

On May 5, 2026, the City Council supported all of the Study recommendations, some with revisions. City Council guidance and support are described for each recommendation in Attachment 2.

On June 4 and June 17, 2026, staff conducted two virtual focus group conversations to ask for participant feedback on Recommendation Option G.2, as directed by City Council. The participants represented a variety of perspectives based on their involvement with residential development: affordable housing advocates; affordable housing developers; community advocates; local residential developers; and land use planners. Generally, participants were supportive of allowing fee payments to satisfy all inclusionary housing requirements (meaning no on-site inclusionary units would be required) but diverged with regard to the fee rate used to calculate the fee payment: affordable housing advocates favored the maximum fee rates from the Residential Nexus Analysis while for-profit developers favored a lower fee rate.

On August 20, 2026, the Planning Commission recommended the proposed ordinance amendments to City Council, with minor revisions discussed in the “Planning Commission Recommendation” section below.

Proposed Amendments
The proposed amendments to the City’s inclusionary housing requirements implement all Study recommendations based on guidance received from the Planning Commission and City Council. The changes to the inclusionary housing requirements consolidate all inclusionary housing requirements into a single location and reduce inconsistencies between the rental and ownership requirements.

The proposed amendments are a package of amendments to multiple titles of the Santa Barbara Municipal Code, the Fee Schedule, and the Affordable Housing Policies and Procedures. Due to upcoming federal accessibility requirements, the underline-and-strikeout redlines are not used to show proposed ordinance changes; instead, the proposed amendments are shown as new text only (Attachment 1) and are described in more detail in Council Agenda Report
Inclusionary Housing Ordinance Amendments (CITY2026-00003)

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Attachments 2 and 3. The proposed Fee Schedule and Affordable Housing Policy and Procedure amendments will be provided at the introduction hearing at City Council, as they are amended by Council Resolution and do not require Ordinance Committee recommendation. No action is requested on the Fee Schedule or Affordable Housing Policy and Procedure amendments as part of this agenda item; included content is purely informational.

All Inclusionary Housing Requirements in One Location
The proposed amendments consolidate all inclusionary housing requirements from three different chapters—Chapter 28.43, Chapter 30.150, and Chapter 30.160—into a single chapter (Chapter 30.160, Inclusionary Housing). This makes it easier for applicants and staff since all inclusionary housing requirements, no matter the project tenure, location, or incentive zoning program, are in one location.

As part of this effort to consolidate into a single location in the Municipal Code, code references in other sections and titles are updated to the relocated inclusionary housing requirements and all definitions are compiled into a single location (Chapter 30.300, Definitions).

Rounding Requirement for On-Site Units
The proposed amendments change how fractional inclusionary housing requirements— remainders of 0.01 to 0.99—are rounded to be consistent for all projects. Currently, rounding rules differ depending on a project size: projects proposing fewer than 10 units do not have to round up the on-site units required, while projects of 10 or more units do.

This change aligns rounding rules for all projects to allow an in-lieu fee payment for all fractional remainders.1 This implements Council’s direction2, simplifies the inclusionary housing requirements by reducing inconsistencies between requirements based on a project’s tenure, and can positively effect a project’s financial feasibility.

All Inclusionary Units as Density Bonus
The proposed amendments allow all inclusionary housing units to be above maximum residential densities. Currently, rental inclusionary housing units count toward density, whereas ownership inclusionary units do not and are allowed as “bonus” units. Unanimously supported by the Planning Commission and City Council in spring 20263, this change: reduces 1 The proposed change to rounding does not remove an applicant’s ability to provide an on-site inclusionary housing unit to satisfy a fractional remainder.
2 Recommendation Option G.1 to allow in-lieu fee payments for all fractional inclusionary requirements was supported by a majority of City Council (Santamaria dissent, Sneddon abstain) on May 5, 2026. 3 Recommendation F is to count rental inclusionary units as bonus density.

Council Agenda Report
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inconsistencies between rental and ownership requirements; supports efforts to consolidate all inclusionary housing requirements as one program; assists with financial feasibility of rental projects; and supports Housing Element goals to create new housing (more units are allowed in a project providing inclusionary housing units) and prioritize affordable housing (better financial feasibility means higher likelihood for projects that could create inclusionary housing units).

One In-Lieu Fee Calculation Method
The proposed amendments apply the same formula to calculate the inclusionary housing inlieu fee payments for both rental and ownership projects. Currently, the ownership calculation method is complex, with multiple variables that must be calculated by staff for every ownership project. In contrast, the current rental calculation is much simpler.

The amendment proposes incorporating inclusionary housing fee rates into the Fee Schedule, rather than relying on a staff calculation (ownership) or the ordinance (rental). The rationale behind this is two-fold: 1) annual adjustments to the fee rates will occur as part of the annual budget process to ensure the rates keep up with inflation, and 2) the inclusionary housing fee rate will align with best practices of precedent jurisdictions.

Unanimously supported by the Planning Commission and City Council in Spring 20264, this shift to one in-lieu fee calculation method with simplified fee rates in the Fee Schedule: reduces inconsistencies between rental and ownership requirements; supports efforts to consolidate all inclusionary housing requirements as one program; increases predictability for an applicant because they can calculate the in-lieu fee payment without variables required from staff; and means the fee rates will automatically be evaluated annually for adjustment.

Collection and Timing of Fee Payments
Currently, inclusionary fees are collected in the Affordable Housing Inclusionary Fund and are transferred annually to the Local Housing Trust Fund. The proposed amendments collect all inclusionary housing fee payments into the Local Housing Trust Fund (LHTF). This change implements feedback from Planning Commission and City Council in Spring 2026.

The timing to collect fee payments is simplified: Absent certain limited exceptions, payments will be due prior to building permit issuance or final subdivision map, rather than the current rules that collect the inclusionary fee payment at different points in the permitting process 4 Recommendation H is to simplify in-lieu fee calculations for ownership projects.

Council Agenda Report
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based on multiple project factors (e.g., number of units). Applicants may choose to pay higher in-lieu fees in order to pay after building permit issuance.5 Alternative Compliance Options
The proposed amendments provide four options for a project to comply with the inclusionary housing unit requirements: 1) on-site inclusionary housing units, 2) new off-site inclusionary housing units, 3) acquire and rehabilitate existing units, or 4) offset fee payment. These options increase flexibility for an applicant to comply with the inclusionary housing requirements.

A project may construct inclusionary housing units off-site rather than on-site. This option currently exists for ownership projects, but not for rental projects. An applicant must construct the same quantity of off-site units as would be required on-site, and all the development standards, price restrictions, and eligible households for on-site units apply to off-site units.

The location of the off-site units is regulated. The main development’s building permit cannot be issued prior to issuance of the off-site unit building permit, and the off-site units must receive final occupancy prior to occupancy of the main development.

A newly proposed alternative allows a project to acquire and rehabilitate existing units rather than construct on-site inclusionary housing units. An applicant must acquire and rehabilitate more units than the quantity required on-site (50 percent more inclusionary units required).

Similar to off-site inclusionary housing units, acquired and rehabilitated units have location requirements and must meet the same development standards, price restrictions, and eligible household criteria as the on-site units. Permit issuance and occupancy for the main development and the acquired and rehabilitated units are tied together.

Another proposed alternative is an inclusionary housing offset fee. This is Option G.2 from the Study, rebranded to reduce confusion between the offset fee, which fully satisfies the inclusionary housing requirements, and the in-lieu fee, which satisfies fractional inclusionary housing requirements (including requirements for projects with fewer than 10 units). The different names also keep the fee rates, which differ for in-lieu and offset fee payments, clearly defined in the Fee Schedule.

Affordability Control Covenant
An affordability control covenant is required for any project that includes inclusionary units.

Following Planning Commission’s review, staff made a minor update to this section of the proposed ordinance (SBMC 30.160.080) to clarify that this covenant should be recorded 5 All payments must be made prior to Certificate of Occupancy.

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pursuant to the Affordable Housing Policies and Procedures, which generally requires recordation prior to issuance of the building permit.

Planning Commission Recommendation
On August 20, 2026, Planning Commission recommended the proposed ordinance amendments to City Council (voting five in favor, two opposed), with the following revisions/comments:
• Add a definition for “net livable floor area,”
• Include more example calculations in material supporting the ordinance amendments, • Use the term “offset fee” consistently,
• Create a handout of inclusionary housing requirements for applicants, and • Reduce the offset fee rate for rental projects in the Central Business District to $73 per square foot.

Commissioners Baucke and Wiscomb did not support the motion because of the reduced offset fee rate for rental projects in the Central Business District.

Net Livable Floor Area
Planning Commission’s motion includes direction to staff to add a definition for “net livable floor area” to clarify the fee calculations. To achieve the goal of increasing clarity without creating a new definition, which could cause its own confusion, staff revised the in-lieu fee and offset fee calculations to describe the floor area included in the calculation more clearly.

Example Calculations
Staff will propose a new appendix to the Affordable Housing Policies and Procedures with example inclusionary housing calculations, which was supported in Planning Commission’s motion.

Handout for Applicants
Staff intends to create a handout about inclusionary housing requirements for applicants after the proposed inclusionary housing ordinance amendments are adopted, which was supported in Planning Commission’s motion.

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Offset Fee
Planning Commission’s motion recommended a reduced offset fee rate for rental projects in the Central Business District ($73 per square foot) rather than the fee rate proposed by staff ($91 per square foot). A majority of Planning Commission supported the $73-per-square-foot offset fee rate for rental projects downtown to facilitate rental residential development in that area.

Outside the Central Business District (CDB), they supported the $91-per-square-foot fee as proposed. Commissioners Wiscomb and Baucke dissented, on the grounds that there should be no differentiation between the offset fee based on location, noting that offering an applicant the ability to pay an offset fee is a new compliance option not currently available, and it would be premature to lower the fee before it’s tested in the real world.

Additionally, Planning Commission’s motion included direction to staff to consistently use the term “offset fee,” to describe this compliance method.

Rationale for Rental Offset Fee Rates
Staff recommended offset fee rates of $91 per square foot for rental projects and $72 per square foot for ownership projects for multiple reasons. First, these fee rates support the policy preference to prioritize on-site unit creation since it is more expensive to pay an offset fee than construct an on-site inclusionary unit, as demonstrated in additional financial feasibility analysis conducted by BAE Urban Economics (included in Attachment 4). Second, the units built to satisfy the inclusionary housing requirements serve Moderate-Income (rental) and Middle-Income (ownership) households. Although an offset fee may lead to more funds collected in the Local Housing Trust Fund, these fee payments are less likely to support creation of affordable units for Moderate-Income and Middle-Income households because most funding resources available to develop affordable housing are aimed at supporting lower-income households. Third, it is the legally defensible maximum that could be charged for inclusionary housing based on the Residential Nexus Study (Appendix D of the Study). Fourth, Planning Commission supported these fee rates in April 2026 when providing guidance on the Study recommendations. City Council’s direction in May 2026 when providing guidance on the Study recommendations was for additional outreach and research into offset fees, although Councilmembers’ comments reflected support for and opposition to the idea of an offset fee and the rate amounts. And finally, for rental projects, the anticipated amount generated to construct one affordable rental unit at an offset fee rate of $91 per square foot is approximately $740,000,6 which aligns closely with affordable unit developments’ costs documented in Low6 Approximate value based on large rental prototypes from the Study. The approximate amount collected for one affordable unit is the offset fee payment divided by the inclusionary housing requirement for the prototype.

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Income Housing Tax Credit applications (in Appendix A of the Study). For these reasons, staff recommended the offset fee rates of $91 per square foot for rental projects and $72 per square foot for ownership projects.

The Planning Commission’s suggested fee rate of $73 per square foot for rental projects downtown aligns with the construction cost analysis. The construction cost analysis evaluated possible fee rates in the Study by calculating the cost for a developer to construct an on-site inclusionary housing unit. A fee based on the construction cost analysis ensures that the revenue generated by the fee is sufficient to support the construction of an affordable unit. The construction cost fee rate calculated for rental prototypes is between $72 and $73 per square foot.

A $91-per-square-foot fee rate is expected to generate approximately $740,000 toward construction of one affordable unit. A $73-per-square-foot fee rate is expected to generate approximately $590,000 toward construction of one affordable unit.7 The City cannot exceed an inclusionary housing fee rate of $91.41 per square foot, based on the Residential Nexus Analysis, but does not have to align with the construction cost analysis in setting a fee.

Request for Ordinance Committee Guidance
Staff requests direction from Ordinance Committee on the offset fee rate to propose in the Fee Schedule amendments for rental projects in the Central Business District.

If Ordinance Committee agrees with Planning Commission’s recommendation to reduce the rental offset fee rate in the Central Business District, staff recommends using $72 per square foot8 to align with the ownership offset fee rate to minimize the quantity of close, but not quite identical, fee rates for inclusionary housing.
 Prototype V is a 43-unit rental project with a 4.3 inclusionary housing requirement (10%). The offset fee payment at $91 per square foot is $3,173,433. $3,173,433 divided by 4.3 equals $738,010 collected to fund one affordable unit.
 Prototype IV is a 20-unit rental project with a 2.0 inclusionary housing requirement (10%). The offset fee payment at $91 per square foot is $1,476,020. $1,476,020 divided by 2.0 equals $738,010 collected to fund one affordable unit.
7 Using the same formulas and prototypes in the previous footnote and a $73-per-square-foot offset fee rate, Prototype V has an offset fee payment of $2,545,729, and Prototype IV has an offset fee payment of $1,184,060.

Both prototypes calculate to $592,030 collected to fund one affordable unit. 8 A $72-per-square-foot fee rate is expected to generate approximately $585,000 toward construction of one affordable unit.

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Budget/Financial Information
The proposed ordinance amendments direct all inclusionary housing fee payments into the Local Housing Trust Fund (LHTF), rather than collecting the payments in the Affordable Housing Inclusionary Fund and then transferring the funds to the LHTF, as required by the LHTF ordinance. This measure implements feedback from the Planning Commission and City Council received in spring 2026.

Inclusionary housing fees are an inconsistent revenue source for the LHTF because collections depend on residential development activity, which is outside the City’s control. Over the last 16 years, the City has collected $1,546,667 in in-lieu fee revenue, averaging $96,667 per year.

Annual revenue has varied significantly, and some fiscal years have had no collections.

Nonetheless, inclusionary housing fee revenue continues to provide important support for the LHTF.

The proposed fee rates are anticipated to increase collected funds in the Local Housing Trust Fund. In-lieu fee payments on applicable projects might increase because the proposed fee rates are higher than current amounts (example: rental in-lieu fee rate increasing from $25 per square foot to $50 per square foot), and the change in rounding rules will allow all projects to satisfy remaining fractional requirements with an in-lieu fee payment. This means more projects will be eligible to pay an in-lieu fee. Additionally, the alternative compliance option for an offset fee might result in increased inclusionary housing fee collections.

Environmental Review
Environmental review under the California Environmental Quality Act (CEQA) was conducted for this action as part of the Housing Plan Program Environmental Impact Report (Program EIR, SCH 2022040209), certified by the City Council on August 11, 2026. The Program EIR adequately describes the inclusionary housing ordinance amendments for the purposes of CEQA, and the ordinance amendments are within the scope of the Program EIR.

The EIR is a programmatic analysis that covers programs within the 6th Cycle Housing Element.

The inclusionary ordinance provisions would implement housing policies evaluated for citywide environmental impacts in the EIR. The inclusionary housing ordinance amendments would not result in any new significant effects, substantial changes to previously identified effects, unusual circumstances, or substantial new information that would require major revisions to the Program EIR. No substantial changes in land use would occur as a result of the ordinance amendments, nor would any changes to the build-out assumptions used in the EIR Council Agenda Report
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analysis. No increase in development impacts on the environment would result under the ordinance amendments pursuant to CEQA Guidelines §15162 criteria, and no additional CEQA document is required. City Council environmental findings made for Housing Plan adoption continue to apply with this ordinance implementation measure [CEQA Guidelines 15168].

Attachments:

1. Draft Inclusionary Housing Ordinance Amendments

2. Implementing the Study Recommendations

3. Explanation of Revisions in the Proposed Amendments

4. Financial Feasibility Analyses of Council-Supported Recommendations

5. General Plan Consistency Analysis
Prepared by: Dana Falk, Project Planner
Submitted by: Allison DeBusk, Community Development Director Approved by: Kelly McAdoo, City Administrator
Inclusionary Housing Ordinance Amendments Attachment 1
Proposed Ordinance Amendments 1
[Draft Showing Changes From Current Code August 20, 2026] Ordinance No.

AN ORDINANCE OF THE COUNCIL OF THE CITY OF SANTA

BARBARA AMENDING THE SANTA BARBARA MUNICIPAL CODE
TO AMEND SECTION 25.02.030 OF CHAPTER 25.02 OF TITLE 25, AMEND SECTION 26.80.030 OF CHAPTER 26.80 OF TITLE 26,
AMEND CHAPTER 28.43 OF TITLE 28, AMEND SECTION 30.15.050 OF CHAPTER 30.15 OF TITLE 30, AMEND SECTIONS 30.150.020 AND 30.150.080 OF CHAPTER 30.150 OF TITLE 30, AMEND
CHAPTER 30.160 OF TITLE 30, AMEND SECTION 30.185.045 OF CHAPTER 30.185 OF TITLE 30, AMEND SECTIONS 30.300.010,

30.300.080, 30.300.120, 30.300.180, AND 30.300.190 OF
CHAPTER 30.300 OF TITLE 30, AND DELETE
SECTIONS 30.150.110, 30.150.120, 30.150.130, 30.150.140, AND

30.150.150 OF CHAPTER 30.150 OF TITLE 30 PERTAINING TO

REGULATIONS FOR INCLUSIONARY HOUSING
THE CITY COUNCIL OF THE CITY OF SANTA BARBARA DOES ORDAIN AS FOLLOWS:

Section 1
Section 25.02.030 of Chapter 25.02 of Title 25 of the Santa Barbara Municipal Code is amended to read as follows:

25.02.030 General Requirements.

A. Main Building. Development standards in this chapter apply to main buildings.

B. Accessory Structures. See Section 30.140.020 (Accessory Buildings).

C. Uses. Allowed uses are regulated by the Base Zone district (e.g., R-2). See Title 30 (Zoning– Inland) and Title 28 (Zoning–Coastal) of the Santa Barbara Municipal Code.

D. Density. The total number of units per lot must not exceed the maximum allowed by the General Plan or Coastal Land Use Plan land use designation for the site, expressed as a range Inclusionary Housing Ordinance Amendments Attachment 1
Proposed Ordinance Amendments 2
of dwelling units per acre (du/ac). The maximum number of units identified for each building type is dependent on the design site being large enough to accommodate all the zone's standards (e.g., setbacks, parking, open yard, etc.).

1. Minimum Unit Quantities. The ODDS requires a minimum of two residential units per project.
a. Projects of three or more residential units must exceed, by at least one unit, the maximum base residential density for the base zone (Section 30.20.030 (Development Standards), Section 30.25.030 (Development Standards), and Section 30.30.030 (Development Standards)) and comply with the maximum average unit size per Section 30.150.075 (Process to Establish Density Tier).

2. Density Bonus. ODDS projects may exceed General Plan maximum density by using State or City density bonus in compliance with Chapter 30.145 (Affordable Housing and Density Bonus Incentives) or Section 28.87.400 (Density Bonus and Development Incentives).

E. Inclusionary Units. All ODDS projects must comply with the inclusionary housing requirements in Chapter 28.43, Inclusionary Housing Ordinance, or Chapter 30.160, Inclusionary Housing, as applicable.

F. Prohibition Against Hotel Conversion. Residential units approved, permitted, or constructed under ODDS shall not be converted to a hotel or other similar use as delineated in Section 30.295.040.P (Commercial Use Classifications).

G. Nonresidential Growth Management. Nonresidential floor area is subject to the requirements of Chapter 30.170 (Nonresidential Growth Management Program).

H. Building Form and Placement. Standards for building height and setbacks are further limited in compliance with the following standards, as applicable, including, but not limited to:

1. The requirements of Section 30.140.170 (Solar Access Height Limitations).

2. The requirements of Section 25.04.170 (Adjacency and Height Standards).

3. The requirements of Section 30.30.030 (Development Standards) for nonresidential portions of mixed-use buildings adjacent to residential zones.

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4. The requirements of the Coastal Zone Special Treatment Area in Section 28.22.030 (Land Uses Permitted).

5. The requirements of Section 30.150.090 (Additional Development Incentives) for market rate ownership projects within the Upper State Street Area (USS) Overlay Zone (Chapter 30.85).

I. Encroachments. Encroachments are not allowed within the right-of-way unless approved by a separate encroachment permit in compliance with Chapter 22.21 (Encroachments into Public Roads, Streets, Alleys and Rights-of-Way as Public Nuisance).

1. Encroachments are not allowed across a design site line.

2. Frontages are allowed to encroach into the primary front and secondary front setbacks by a maximum of 10 feet in the Neighborhood Medium (NM), Neighborhood Large (NL), and Mixed-Use Corridor (MUC) zones.

3. For all other encroachments, see Section 30.140.090 (Encroachments into Setbacks and Open Yards).

Section 2
Section 26.80.030 of Chapter 26.80 of Title 26 of the Santa Barbara Municipal Code is amended to read as follows:

26.80.030 Funding Sources.

SBLHTF shall receive funding from the sources set forth below. SBLHTF may also receive funding from any other legally available source.

A. Matching Funds. The SBLHTF shall receive matching funds in the amount of $2,883,548, that was allocated by the City Council on December 6, 2022, from the General Fund and specifically dedicated to a local housing trust fund.

B. Ongoing Revenue. All inclusionary housing in-lieu fees collected under Chapter 28.43, Inclusionary Housing Ordinance, and Chapter 30.160, Inclusionary Housing, in the Municipal Code shall be deposited in the Local Housing Trust Fund as a dedicated and continuous source for operations of the Fund for a minimum of the required first five years of the Fund's existence.

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C. City Council may allocate funds as ongoing revenue and matching funds to the SBLHTF to provide additional funding as needed.

Section 3
Chapter 28.43 of Title 28 of the Santa Barbara Municipal Code is amended to read as follows:

Chapter 28.43, Inclusionary Housing Ordinance
Inclusionary housing is required in accordance with Chapter 30.160, Inclusionary Housing.

Section 4
Section 30.15.050 of Chapter 30.15 of Title 30 of the Santa Barbara Municipal Code is amended to read as follows:

30.15.050 Fractions.

Whenever this title requires consideration of numerical quantities, all calculations shall use fractions no smaller than hundredths, and if the end result of a calculation contains a fraction of a whole number, the results shall be rounded as follows:

A. General Rounding. Fractions are to be rounded up to the nearest whole number, except as otherwise provided.

B. Exception for Parking Spaces. In determining the number of parking spaces fractions are to be rounded down to the nearest whole number. Where multiple structures or standards are involved, any rounding of spaces must be made on the aggregate total required for the site, and not on individual uses prior to calculating the total. See Section 30.175.040, Required Automobile and Bicycle Parking Spaces, for additional parking rounding requirements.

Section 5
Sections 30.150.020 and 30.150.080 of Chapter 30.150 of Title 30 of the Santa Barbara Municipal Code are amended to read as follows:

30.150.020 Definitions.

See Chapter 30.300, Definitions.

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30.150.080 Inclusionary Housing Requirements
Residential units developed in accordance with the Average Unit-Size Density Incentive Program of this chapter must comply with Chapter 30.160, Inclusionary Housing. The increased number of residential units a project is entitled under Chapter 30.160 must also comply with the maximum average unit size for the base density of the project under the Average Unit-Size Density Incentive Program.

Section 6
Chapter 30.160 of Title 30 of the Santa Barbara Municipal Code is amended to read as follows:

Chapter 30.160, Inclusionary Housing
Sections:

30.160.010 Purpose

30.160.020 Definitions

30.160.030 Inclusionary Housing
Requirements

30.160.040 Inclusionary Housing Units

30.160.050 Inclusionary Housing In-Lieu
Fees

30.160.060 Alternative Compliance

30.160.070 Affordable Housing Plan

30.160.080 Affordability Control Covenant

30.160.010 Purpose.

The purpose of this Chapter is to increase the supply of affordable housing by requiring that a percentage of market-rate residential units in a housing project be made available to Moderate-, Middle-, and Upper-Middle-Income households. This requirement supports mixed-income neighborhoods and ensures equitable access to affordable housing throughout the City.

30.160.020 Definitions.

See Chapter 30.300, Definitions.

30.160.030 Inclusionary Housing Requirements.

A. Rental Housing Projects.

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1. 10 or More Units. A rental housing project of 10 or more residential units must construct and offer at an affordable rent at least 10% of the total residential units as on-site inclusionary units restricted for Moderate-Income Households.

2. 5 Through 9 Units. A rental housing project of five through nine units must either construct and offer at an affordable rent at least one inclusionary unit restricted for a Moderate-Income household, or pay an inclusionary housing in-lieu fee as specified by Section 30.160.050, Inclusionary Housing In-Lieu Fees.

B. Ownership Housing Projects.

1. Condominium, 10 or More Units. An ownership housing project of 10 or more residential units must construct and offer for sale at least 15% of the total residential units as on-site inclusionary units restricted for owner-occupancy by Middle-Income Households.

2. Condominium, 2 Through 9 Units. An ownership housing project of two through nine units must either construct and offer for sale at least one inclusionary unit restricted for owner-occupancy by a Middle-Income household or pay an inclusionary housing in-lieu fee as specified by Section 30.160.050, Inclusionary Housing In-Lieu Fees.

3. Subdivision, Lot with Development, 10 or More Units. An ownership housing project of 10 or more lots that includes construction of residential units must construct and offer for sale at least 15% of the total residential units as on-site inclusionary units for owner-occupancy by Upper-Middle-Income Households.

4. Subdivision, Lot with Development, 2 Through 9 Units. An ownership housing project of two through nine lots that includes construction of residential units must pay an inclusionary housing in-lieu fee as specified by Section 30.160.050, Inclusionary Housing In-Lieu Fees.

5. Subdivision, Lot-Only. All residential lot-only subdivisions resulting in two or more lots must pay an inclusionary housing in-lieu fee as specified by Section 30.160.050, Inclusionary Housing In-Lieu Fees.

C. Unit Count Calculations. To calculate the inclusionary housing requirement, the total number of residential units in a project must include all proposed residential units in the project and other units as follows:

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1. Existing Residential Units. Existing-to-remain residential units with a Certificate of Occupancy or final inspection that occurred at least five years prior to the first application submittal for the proposed residential units do not count as part of the total number of residential units in the calculation of inclusionary housing requirements.
a. Projects permitted in accordance with Section 30.185.045, Adaptive Reuse Projects, must count all existing-to-remain residential units regardless of Certificate of Occupancy or final inspection date as part of the total number of units in the calculation of inclusionary housing requirements.

2. Density Bonus Units. Any residential units authorized and approved as a density bonus under State Density Bonus Law or the City's Affordable Housing Policies and Procedures will not be counted in determining the required number of inclusionary units.

3. Accessory Dwelling Units. Any accessory dwelling unit authorized and approved under a building permit will not be counted in determining the inclusionary housing requirements.

4. Combining Residential Developments. Housing projects under concurrent review that share a common boundary and are proposed by the same applicant or applicants with substantial common ownership will be treated as a single development for inclusionary housing requirement calculations. Substantial common ownership is defined as 60% or more shared control among general partners, members, or voting shares.

D. On-Site Inclusionary Units.

1. Fractional Requirements. Any fractional inclusionary housing requirement of 0.01 or greater may be satisfied by providing an additional on-site inclusionary unit or by payment of an inclusionary housing in-lieu fee, as specified in Section 30.160.050, Inclusionary Housing In-Lieu Fees.

2. Inclusionary Housing as Bonus Units. On-site inclusionary units do not count towards the maximum residential density on a site and do not require a lot area modification for the on-site inclusionary units to exceed maximum residential density limits.

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3. State Density Bonus Law. Projects using State Density Bonus Law (Government Code Sections 65915-65918) may count income restricted units proposed at lower income levels than required by this chapter towards the on-site inclusionary unit requirement, but they are not considered on-site inclusionary housing units eligible as bonus units per Section 30.160.030.D.2.

E. Affordable Housing Policies and Procedures. All inclusionary housing requirements must be satisfied in accordance with the City’s Affordable Housing Policies and Procedures as adopted by the City Council of the City of Santa Barbara and amended from time to time. If the Affordable Housing Policies and Procedures are in conflict with any regulations in this Title, this Title prevails.

F. Exemptions from Inclusionary Requirements. The requirements of this chapter do not apply to the following project types:

1. 100% Affordable Projects. As defined in Section 30.300.010, “A”.

2. Casualty Reconstruction Projects. The reconstruction of any residential units or structures which have been destroyed by fire, flood, earthquake or other act of nature, which are being reconstructed in a manner consistent with the requirements of Subsection 30.165.080.C, Repair and Replacement of Damaged or Destroyed Nonconforming Buildings.

3. Employer-Sponsored Housing Projects. Employer-Sponsored Housing Projects developed in accordance with the Average Unit-Size Density Incentive Program of Chapter 30.150, Average Unit-Size Density Incentive Program.

G. Consistent with State Law. Any portion of this chapter that conflicts with any applicable State law is superseded by State law. Any ambiguities in this chapter must be interpreted to be consistent with State law. Statutory references in this ordinance include successor provisions.

30.160.040 Inclusionary Housing Units.

A. Development Standards. Inclusionary units built under this chapter must conform to the following standards:

1. Unit Distribution. Inclusionary units must be distributed across multiple areas of the site, phase, building, and story; avoiding concentration in a single building, phase, floor, story, or area.

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2. Design Quality. Inclusionary units must be comparable in construction quality and exterior design to the market-rate units constructed, as determined by the Community Development Director. Inclusionary units may have different interior finishes and features than market-rate units so long as the interior features are durable, of good quality and consistent with contemporary standards for new housing, as determined by the Community Development Director.

3. Bedrooms and Bathrooms. The average number of bedrooms and bathrooms in the inclusionary units must equal or exceed the average number of bedrooms and bathrooms in the market-rate units of the project.

4. Unit Size. Each inclusionary unit must meet the standards in Section 30.140.150, Residential Unit.

5. Common Amenities. Residents of on-site inclusionary units must have the same rights and access to common amenities in the project, such as parking, open space, storage, and recreation space, as residents in market-rate units.

6. Timing of Construction. Inclusionary units must be constructed and made available for occupancy concurrently with or prior to the construction and occupancy of the market-rate units of the project. In phased developments, inclusionary units must be constructed and occupied proportionally with the number of market-rate units in each phase.

B. Price Restrictions for Inclusionary Units. Inclusionary units must be sold or rented at or below affordable prices calculated in conformance with the Affordable Housing Policies and Procedures.

1. Voluntary Affordability. Inclusionary units may be restricted at a lower affordability level than required.

2. Duration of Affordability. The inclusionary housing units must remain affordable for the duration established in the Affordable Housing Policies and Procedures, unless otherwise stipulated by State law.

3. Sales Price. The initial sales price of an ownership housing inclusionary unit must be calculated as established in the City's Affordable Housing Policies and Procedures.

The maximum resale price and purchaser eligibility is governed by the affordability control covenant and must comply with the City's Affordable Housing Policies and Procedures.

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4. Transfers and Conveyances. The affordability control covenant must be renewed and recorded upon any transfer of ownership, whether voluntary or by operation of law, in accordance with the City’s Affordable Housing Policies and Procedures.

C. Eligible Households for Inclusionary Housing. Inclusionary units must be sold or rented to eligible affordable housing households in conformance with the Affordable Housing Policies and Procedures.

1. Occupancy. A household which purchases or rents an inclusionary unit must occupy that unit as a principal residence, as that term is defined for federal tax purposes by the United States Internal Revenue Code.

30.160.050 Inclusionary Housing In-Lieu Fees.

A. Payment of Inclusionary Housing In-Lieu Fee. All inclusionary housing in-lieu fees paid under this section will be deposited into the City of Santa Barbara Local Housing Trust Fund as provided for in Chapter 26.80, Local Housing Trust Fund.

B. Inclusionary Housing In-Lieu Fee Rates. The inclusionary housing in-lieu fee rates are established by resolution of the City Council and adjusted annually by the Community Development Director based on the annual percentage in the California Construction Cost Index, published by the California Department of General Services, for the 12-month period from December to December each year.

C. Calculation of Inclusionary Housing In-Lieu Fee Amount. The inclusionary housing inlieu fee is based on the fee rate in effect at the time of building permit issuance. The fee amount is calculated using the following formulas:

1. Fractional Requirement. The inclusionary housing in-lieu fee amount for fractions of inclusionary housing requirements, as provided in Section 30.160.030, Inclusionary Housing Requirements, is calculated by first dividing the remaining fractional requirement of the inclusionary housing requirement by the total inclusionary housing requirement, and multiplying the result by the livable floor area of the entire project and the inclusionary housing in-lieu fee rate for ownership units or rental units, as applicable, at the time of building permit issuance. See the Affordable Housing Policies and Procedures for example calculations.

Inclusionary Housing In-Lieu Fee Amount = Fractional Inclusionary Housing Requirement / Total Inclusionary Housing Requirement x Inclusionary Housing InLieu Fee Rate x Livable Floor Area of the entire project Inclusionary Housing Ordinance Amendments Attachment 1
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Example: 43-unit rental housing project totaling 34,873 sq. ft. (livable floor area of the entire project) has a total inclusionary housing requirement of 10%, or 4.3. An applicant must provide four inclusionary units and pay an in-lieu fee for the remaining 0.3 fractional requirement (4.3 – 4 on-site units = 0.3). This example uses $50.00 per sq. ft. as the inclusionary housing in-lieu fee rate. The inclusionary housing in-lieu fee amount is calculated as follows:

Fractional Inclusionary Housing Requirement 0.3
Total Inclusionary Housing Requirement 4.3
Inclusionary Housing In-Lieu Fee Rate $50.00 per sq. ft.

Livable Floor Area of the entire project 34,873 sq. ft

0.3 / 4.3 x $50.00 per sq. ft x 34,873 sq. ft.

Inclusionary Housing In-Lieu Fee Amount $121,650

2. Residential Lot-Only Subdivisions. The inclusionary housing in-lieu fee amount for residential lot-only subdivisions is calculated using the applicable inclusionary housing in-lieu fee rate prorated based on quantity of proposed lots. The inclusionary in-lieu fee amount for residential lot-only subdivisions is calculated as follows:

Prorated Inclusionary Housing In-Lieu Fee Rate x Total Lots resulting from subdivision
a. The prorated fee rate for residential lot-only subdivisions of nine or fewer lots is five percent of the inclusionary in-lieu fee rate.
b. The prorated fee rate for residential lot-only subdivisions of ten or more lots is fifteen percent of the inclusionary in-lieu fee rate.

See the Affordable Housing Policies and Procedures for example calculations.

3. Phased Construction. The inclusionary housing in-lieu fee amount must be calculated based on the total livable floor area of all phases, with the proportional fee amount due prior to issuance of building permit for each phase.

D. Timing of Payment. Projects must pay the inclusionary housing in-lieu fee prior to issuance of a building permit, except as follows:

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1. Lot with Development Subdivisions and Condominium Units. Must pay the inclusionary housing in-lieu fee prior to building permit issuance or recordation of the Final Subdivision Map, whichever occurs first.

2. Condominium Conversion. Condominium conversions must pay the inclusionary housing in-lieu fee prior to recordation of the Final Subdivision Map.

3. Lot-Only Subdivisions. Lot-only subdivisions must pay the inclusionary housing inlieu fee prior to recordation of the Final Subdivision Map.

4. Phased Construction. Projects with phased construction must pay the applicable inclusionary housing in-lieu fees prior to issuance of the building permit for each phase of the project.

5. Delayed Payment. Projects may request and receive approval for a delayed payment of the inclusionary housing in-lieu fee from the Community Development Director upon the condition that the inclusionary housing in-lieu fee amount must be paid prior to issuance of Certificate of Occupancy or final inspection, whichever occurs first, and will be the greater of the following:
a. Inclusionary housing in-lieu fee amount with a 10% increase for each year, or portion thereof, the payment is delayed starting from the inclusionary housing in-lieu fee amount calculated at building permit issuance until the date the fee is paid, or
b. Inclusionary housing in-lieu fee amount based on the inclusionary housing inlieu fee rate in effect at the time the delayed inclusionary housing in-lieu fee is paid.

See the Affordable Housing Policies and Procedures for example calculations.

30.160.060 Alternative Compliance.

Applicants may propose alternative methods of compliance to satisfy inclusionary housing requirements by submitting an Affordable Housing Plan that complies with the following requirements.

A. Alternative Compliance Options.

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1. Off-Site Construction. An applicant may satisfy all or a portion of the required inclusionary housing requirements by the construction of inclusionary units off-site as follows:
a. The off-site inclusionary units are located within the City of Santa Barbara boundaries and meet one of the following criteria in relation to the main development:
i. Within one mile of the main development; or
ii. Within the same or a higher resource area than the main development, as defined by the California Tax Credit Allocation Committee (TCAC) Opportunities Map.
b. The quantity of off-site inclusionary units equals or exceeds the quantity of onsite inclusionary units required by the main development. c. The off-site inclusionary units must meet the Development Standard in Section 30.160.040, Inclusionary Housing Units.
d. The off-site inclusionary units must meet the Price Restrictions for Inclusionary Units and Eligible Households for Inclusionary Housing requirements in Section 30.150.040, Inclusionary Housing Units. e. The off-site inclusionary housing units must have an issued building permit prior to issuance of a building permit or recordation of the Final Subdivision Map for the main development.
f. The off-site inclusionary housing units must have an issued Certificate of Occupancy and the affordability control covenants must be recorded per Section 30.160.070, Affordable Housing Plan prior to final inspection or issuance of a Certificate of Occupancy for the main development.

2. Acquisition and Rehabilitation. An applicant may satisfy all or a portion of the inclusionary housing requirements by acquiring and rehabilitating existing units if they satisfy the following:
a. The acquired and rehabilitated units are located within the City of Santa Barbara boundaries and meet one of the following criteria in relation to the main development:

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i. Within one mile of the main development; or
ii. Within the same or a higher resource area than the main development, as defined by the California Tax Credit Allocation Committee (TCAC) Opportunities Map.
b. The minimum quantity of acquired and rehabilitated units is 150% of the onsite inclusionary housing units required for the main development. At minimum, an applicant must provide one additional acquired and rehabilitated existing unit than the minimum quantity of required on-site inclusionary housing units. Fractional remainders for acquired and rehabilitated units must be rounded up to the next whole unit when calculating required units. See the Affordable Housing Policies and Procedures for example calculations. c. The off-site residential units must meet current health, safety, and building code standards as determined by the Chief Building Official for structural fixes, updates to electrical and plumbing systems, and any repairs necessary to ensure the dwelling is habitable and meets modern standards of safety and accessibility.
d. The off-site inclusionary units must meet the Development Standard requirements in Section 30.160.040, Inclusionary Housing Units. e. The acquired and rehabilitated units must comply with the Price Restrictions for Inclusionary Units and Eligible Households for Inclusionary Housing requirements in Section 30.150.040, Inclusionary Housing Units. f. The acquired and rehabilitated units must have an issued building permit for any required repairs prior to issuance of a building permit or recordation of the Final Subdivision Map for the main development.
g. The acquired and rehabilitated units must have an issued Certificate of Occupancy, if applicable, and the affordability control covenant must be recorded per Section 30.160.070, Affordable Housing Plan prior to final inspection or issuance of a Certificate of Occupancy for the main development.

3. Inclusionary Housing Offset Fee Payment. An applicant may satisfy all or a portion of the inclusionary housing requirement without providing onsite units by payment of an inclusionary housing offset fee. The inclusionary housing offset fee Inclusionary Housing Ordinance Amendments Attachment 1
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rates are established by resolution of the City Council and adjusted annually by the Community Development Director based on the annual percentage in the California Construction Cost Index, published by the California Department of General Services, for the 12-month period from December to December each year. The calculation is as follows:
a. The inclusionary housing offset fee is calculated by first dividing the un-built inclusionary housing requirement by the total inclusionary housing requirement, and multiplying the result by the livable floor area of the entire project and the inclusionary housing offset fee rate for ownership units or rental units, as applicable, at the time of building permit issuance. See the Affordable Housing Policies and Procedures for example calculations.

Un-built Inclusionary Housing Requirement / Total Inclusionary Housing Requirement x Inclusionary Housing Offset Fee Rate x Livable Floor Area of the entire project
b. All inclusionary housing offset fees paid under this section will be deposited into the City of Santa Barbara Local Housing Trust Fund as provided for in Chapter 26.80, Local Housing Trust Fund.
c. The inclusionary housing offset fee must be paid prior to issuance of a building permit or recordation of the Final Subdivision Map for the main development.

4. Combination of Approaches. An applicant may propose a combination of on-site inclusionary housing units, fractional in-lieu fee payment, off-site inclusionary housing units, acquired and rehabilitated existing units, or payment of the inclusionary housing offset fee to satisfy the inclusionary housing requirements of a project.

B. Waivers, Adjustments, and Reductions. An applicant may request a waiver, adjustment, or reduction of the inclusionary housing requirements only upon showing that strict application of its requirements would effectuate an unconstitutional taking of property or otherwise have an unconstitutional application to the property.

1. Timing of Request. Requests and supporting documentation must be submitted as part of a complete application to the Community Development Department.

2. Considerations. In making a determination on an application for a waiver, adjustment, or reduction, the applicant bears the burden of presenting substantial Inclusionary Housing Ordinance Amendments Attachment 1
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evidence to support the claim. The City may assume each of the following when applicable:
a. That the Applicant will provide the most economical inclusionary units feasible, consistent with this chapter and the City’s Affordable Housing Policies and Procedures; and
b. That the applicant will benefit from incentives under this chapter and the Zoning Ordinance.

3. Timing of Decision. The Community Development Director will consider the application and issue written findings and a decision within 60 days of receipt of the request and supporting documentation. The Community Development Director may hold a public hearing or refer the matter to the Staff Hearing Officer, Planning Commission, or City Council for a decision.

4. Required Findings. A waiver, adjustment, or reduction of the requirements of this chapter may only be approved if the Community Development Director finds that:
a. Strict application of the requirements would result in an unconstitutional taking or application to the property; and
b. The waiver, adjustment, or reduction is the minimum necessary to avoid such an unconstitutional result.

30.160.070 Affordable Housing Plan.

A. Application Timing. An Affordable Housing Plan is required as part of the planning application submittal or building permit application, whichever occurs first.

B. Approval Timing. Approval of the Affordable Housing Plan is required prior to approval of any Final Subdivision Map or issuance of a building permit, whichever occurs first.

C. Required Plan Elements. The Community Development Director will prepare and issue application forms and lists that specify the information that is required from applicants for an Affordable Housing Plan.

D. Exempt Projects. This section does not apply to exempt projects or to projects that satisfied the entirety of a project’s inclusionary housing requirements by payment of an inclusionary housing in-lieu fee under Section 30.160.050, Inclusionary Housing In-Lieu Fees or an inclusionary housing offset fee under Section 30.160.060, Alternative Compliance.

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30.160.080 Affordability Control Covenant.

A. Rental Housing Project. A standard City affordability control covenant must be recorded for any property that includes one or more inclusionary units per the Affordable Housing Policies and Procedures.

B. Ownership Housing Project. A standard City affordability control covenant for each inclusionary unit must be recorded in accordance with the Affordable Housing Policies and Procedures.

Section 7
Section 30.185.045 of Chapter 30.185 of Title 30 of the Santa Barbara Municipal Code is amended to read as follows:

30.185.045 Adaptive Reuse Projects.

Adaptive reuse projects shall be located, developed, and operated in compliance with the following standards:

A. Purpose. The purpose of this section is to encourage and facilitate the conversion of existing nonresidential buildings throughout the City into new residential uses, to revitalize the downtown, maintain historic structures, and reduce construction waste.

B. Definitions. The following words or phrases as used in this section shall have the following meanings:

1. Adaptive Reuse Project. A change of use of all or any portion of an existing building envelope from nonresidential use to one or more new residential units.

2. Existing Building Envelope. The building volume within the fully enclosed exterior walls, foundations, roof, windows, and doors of a building that existed with a final inspection/certificate of occupancy issued at least five years prior to the date of application submittal for an adaptive reuse project.

C. Where Allowed. Adaptive reuse projects are allowed in all zones that allow multi-unit residential use, subject to the development standards in this section.

D. Conversion Types. Adaptive reuse projects may only convert:

1. Nonresidential land uses to a residential use.

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2. Nonresidential land uses to either mixed use or live-work, consistent with the land uses allowed by the zone.

3. The following uses are prohibited in an adaptive reuse project:
a. New hotel or similar use.
b. New or conversion of industrial uses.

4. Notwithstanding any of the foregoing, any existing floor area may convert to an adaptive reuse project if allowed by State law; however, adaptive reuse projects utilizing State regulations are not eligible for the incentives in this section unless they meet all the requirements of this section.

E. Existing Buildings. An adaptive reuse project shall be located within the existing building envelope, with no additions proposed outside the building volume, except as follows:

1. Maximum 600 square feet or 10% of the existing building floor area, whichever is greater, of additional floor area is allowed outside the existing building envelope to provide residential amenities that serve all units on-site (such as a laundry room, bicycle storage room, or recreation room).

2. Additions necessary for egress, circulation, accessibility, or other improvements to comply with the Building Code, are allowed outside the existing building envelope, up to the minimum size required by the Building Code.

3. Residential additions may be constructed within the existing building envelope, such as mezzanines and lofts.

F. Demolition. An adaptive reuse project shall not demolish or substantially redevelop the existing building as defined in Section 30.140.200, Substantial Redevelopment.

G. Average Unit Size. All the residential units in an adaptive reuse project must meet the standards in Section 30.140.150, Residential Unit, and shall not exceed the following average unit size:

1. Rental Units: 1,200 square feet.

2. Ownership Units: 2,000 square feet.

Exception: The Community Development Director may approve larger unit sizes with a determination that the unit sizes are necessary to accommodate the existing Inclusionary Housing Ordinance Amendments Attachment 1
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building size or shape; the location of building elements such as vertical circulation, exterior windows, access doors; or to facilitate the legalization of preexisting unauthorized residential units.

H. Required Ground Floor Nonresidential Space on State Street. For adaptive reuse projects located on State Street, from Montecito Street to Sola Street, nonresidential uses (excluding parking, storage or other non-occupiable space) are required on the ground floor for the full width of the ground floor fronting onto State Street. The required nonresidential space must be a minimum of 35 feet deep, measured perpendicular to the facade of the building, and may include common residential entries or lobbies but no portion of a residential unit.

I. Development Incentives. Adaptive reuse projects are entitled to the following incentives:

1. Density. The addition of residential units shall not be counted toward the maximum residential density limits applicable for the lot.

2. Open Yard. Any minimum open yard areas required for residential uses shall not apply.

3. Setbacks. Existing building setbacks shall remain, and any setback requirements related to the conversion of existing buildings to residential use shall not apply.

Additions to the existing building envelope to accommodate new floor area as specified in subsection E, may continue nonconforming setbacks.

4. Parking. An adaptive reuse project is not required to provide additional automobile parking spaces, if all the following conditions are met:
a. Bicycle parking in accordance with Chapter 30.175, Parking Regulations, is provided.
b. Parking spaces shall be maintained, or may be reduced or increased, in accordance with the requirements of Chapter 30.175, Parking Regulations; except that when calculating the minimum number of parking spaces for residential units, the required number shall not exceed one space per unit. c. Any requirement to provide electric vehicle supply equipment or parking spaces that are accessible to persons with disabilities is met.

J. Review Process.

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1. Building Permits. Adaptive reuse projects must comply with applicable state and local building codes and require approval of a building permit. Alternative building standards shall be considered pursuant to the California Existing Building Code and the California Historic Building Code, as applicable.

2. Discretionary Review. Adaptive reuse projects shall be exempt from all City discretionary review with the following exceptions:
a. If the project is in the coastal zone, an application for a Coastal Development Permit shall be submitted as required by Chapter 30.210, Coastal Permits. b. If the project includes a subdivision, an application shall be submitted as required by Title 27, Subdivisions. The incentives identified in section

30.185.045.1, Development Incentives, shall apply to condominium development, notwithstanding Section 27.13.060, Physical Standards for Condominiums.
c. If the project includes allowed additions, or exterior alterations, it will be processed according to the discretionary review procedures (e.g., design review, development plan) applicable to multi-unit residential or mixed-use development in the same zone except as follows:
i. Adaptive reuse projects are exempt from any mandatory preapplication or concept review. ii. Minor design alterations, as specified in the applicable Design Guidelines, may be approved as a ministerial action by the Community Development Director without review by the Design Review body.

3. Inclusionary Housing. An adaptive reuse project shall include inclusionary housing consistent with Chapter 30.160, Inclusionary Housing, except:
a. Adaptive reuse projects located within the Central Business District, as delineated in Figure 30.175, with fewer than 40 rental units are exempt from the inclusionary housing requirements in Chapter 30.160, Inclusionary Housing.

Existing residential units retained on-site shall be counted towards the total unit quantity in the adaptive reuse project when calculating inclusionary housing requirements.

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4. Historic Resources. Adaptive reuse projects for Designated Historic Resources must comply with Chapter 30.157, Historic Resources.

5. Contaminated Fill. If an adaptive reuse project is proposed in the "Area of Potential Contaminated Fill," as identified on a map on file with the Community Development Department — Planning Division, and there is ground disturbance or foundation repair proposed as part of the project, it shall not be approved unless the applicable agency makes a determination pursuant to subdivision (c) of Section 25296.10 of the Health and Safety Code, that the site is suitable for residential use.

Section 8
Sections 30.300.010, 30.300.080, 30.300.120, 30.300.180, and 30.300.190 of Chapter 30.300 of Title 30 of the Santa Barbara Municipal Code are amended to read as follows:

30.300.010 “A”
Abutting. Having a common boundary, except that parcels having no common boundary other than a common corner shall not be considered abutting.

FIGURE 30.300.010: ABUTTING
Access. See Driveway and Pathway.

Accessory Building. See Building, Accessory.

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Accessory Structure. See Structure, Accessory.

Accessory Use. See Use, Accessory.

Addition. New construction that increases the net floor area of a structure.

Adjacent. See Abutting.

Adjoining. See Abutting.

Administrative Design Review. A design review process conducted by the Community Development Director for limited-scope design alterations or other qualifying projects as specified in the applicable Design Guidelines. Administrative Design Review is a ministerial action. It does not require a hearing and is final and not appealable, except as expressly provided.

Adversely Affect / Impact. To impact in a substantial, negative manner the livability of a property.

Affordable Housing Terms. The following terms are related to the rules and regulations applicable only to affordable housing or inclusionary housing.

1. 100% Affordable Housing Project. Residential developments that propose 100% of the residential units (excluding managers' units) as deed restricted for Lower- or Moderate-Income households, including Middle- or Upper-Middle-Income for ownership unit projects, in accordance with the City's Affordable Housing Policies and Procedures.

2. Affordable Housing. A residential unit that is sold or rented at a deed-restricted amount defined as being affordable by the City’s Affordable Housing Policies and Procedures. Also called an Affordable Unit.

3. Affordable Housing Households. The following definitions delineate the range of household income categories:
a. Acutely-Low-Income Household. A household, as defined in California Health and Safety Code Section 50063.5 as that Section now appears and may be amended and renumbered, with an income that does not exceed 15% of the area median income, adjusted for family size.
b. Extremely-Low-Income Household. A household, as defined in California Health and Safety Code Section 50106 as that Section now appears and may be amended and renumbered, with an income that does not exceed 30% of the area median income, adjusted for family size. Extremely-Low-Income Households include Acutely-LowIncome Households.

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c. Very-Low-Income Household. A household, as defined in California Health and Safety Code Section 50105 as that Section now appears and may be amended and renumbered, with an income that does not exceed 50% of the area median income, adjusted for family size. Very-Low-Income Households include Extremely-LowIncome Households. d. Low-Income Household. A household, as defined in California Health and Safety Code Section 50079.5 as that Section now appears and may be amended and renumbered, with an income that does not exceed 80% of the area median income, adjusted for family size. Low-Income Households include Very-Low-Income Households. e. Lower-Income Household. Any household with an income that does not exceed a LowIncome Household. f. Moderate-Income Household. A household, as defined in California Health and Safety Code Section 50093 as that Section now appears and may be amended and renumbered, with an income that does not exceed 120% of the area median income, adjusted for family size.
g. Middle-Income Household. A household with an income that does not exceed 160% of the area median income, adjusted for family size.
h. Upper-Middle-Income Household. A household with an income that does not exceed 200% of the area median income, adjusted for family size.

4. Affordable Rent. The maximum monthly housing payment that may be charged for an affordable housing unit calculated in accordance with the City’s Affordable Housing Policies and Procedures.

5. Area Median Income (AMI). The median household income as provided in Section 50093(c) of the California Health and Safety Code.

Agent. Any person, firm, partnership, association, joint venture, corporation, or any other entity or combination of entities who represent or act for or on behalf of an applicant.

Agreement of Sale. Any agreement or written instrument which provides that title to any property shall thereafter be transferred for consideration from one owner to another owner.

Alley. A public or private way that is primarily used for vehicular access to the back or side of properties. Alleys typically do not meet standard requirements for City streets, which include curbs, gutters, sidewalks, or similar improvements. Typically, alleys are separated from adjacent parcels by a lot line. An alley may have an official name and may be shown on the official street map of the City of Santa Barbara.

Allowed Use. See Permitted Use.

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Alteration. An alteration may include both interior and exterior changes and rearrangement of the physical parts of a building, structure or site development that does not result in an increase of floor area. Also called a remodel or renovation.

Ancillary Structure. See Structure, Accessory.

Antenna. The same as defined by the FCC in 47 C.F.R. Section 1.6002(b), as may be amended or superseded, which defines that term as an apparatus designed for the purpose of emitting radiofrequency (RF) radiation, to be operated or operating from a fixed location pursuant to FCC authorization, for the provision of personal wireless service and any commingled information services.

1. Antenna, Amateur or Citizens' Band. The same as defined by the FCC in 47 C.F.R. Section

97.3, as may be amended or superseded, which defines the term as a station in an amateur radio service consisting of apparatus necessary for carrying on radio communication service.

This term includes amateur radio antennas and related facilities used for amateur radio services.

2. Antenna, Base Station. The same as defined by the FCC in 47 C.F.R. Section 1.40001(b)(1), as may be amended, which defines that term as a structure or equipment at a fixed location that enables FCC-licensed or authorized wireless communications between user equipment and a communications network. The term does not encompass a tower as defined in 47 C.F.R.

Section 1.40001(b)(9) or any equipment associated with a tower.

3. Antenna, Collocation Facility. The same as defined by the FCC in 47 C.F.R. Section

1.6002(g), as may be amended or superseded, which defines that term as mounting or installing an antenna facility on a pre-existing structure or modifying a structure for the purpose of mounting or installing an antenna facility on that structure. It does not include the initial installation of a telecommunications facility where previously there was none, nor the construction of an additional tower on a site with an existing tower.

4. Antenna, Eligible Facilities Request. The same as defined in 47 U.S.C. Section 1455(a)(2), as may be amended or superseded, and as interpreted by the FCC in 47 C.F.R. Section

1.6100(b)(3), as may be amended or superseded, which defines that term as a request for modification of an existing tower or base station that does not substantially change the physical dimensions of such tower or base station.

5. Antennas, Emergency Service. Any antenna, and associated equipment and structures, used principally for communications related to government provided emergency services, including, but not limited to, police, fire, and paramedic services.

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6. Antenna, Height. The vertical distance from any point at the top of an antenna or ancillary wireless telecommunications structure to the finished or natural grade, whichever is more restrictive or lower, measured directly adjacent to the existing building or new structure.

7. Antenna, OTARD. Any "over-the-air reception device" subject to 47 C.F.R. Section 1.4000 et seq., as may be amended or superseded, which generally includes satellite television dishes and certain fixed wireless antennas not greater than one meter in diameter.

8. Antenna, Small Cell. Includes a micro wireless facility. Means the same as defined by California Government Code Section 65964.2, as may be amended, which defines that term as a wireless facility that uses licensed or unlicensed spectrum and that includes, but is not limited to, the following qualifications:
a. The small cell antennas on the structure, excluding the associated equipment, total no more than six cubic feet in volume, whether an array or separate. b. Any individual piece of associated equipment on pole structures does not exceed nine cubic feet.
c. The cumulative total of associated equipment on pole structures does not exceed 21 cubic feet.
d. The cumulative total of any ground-mounted equipment along with the associated equipment on any pole or non-pole structure does not exceed 35 cubic feet.

9. Antenna, Stealth. A telecommunication facility that is designed to blend into the surrounding environment. Examples of stealth facilities may include architecturally screened roof-mounted antennas, building-mounted antennas painted to match the existing structure, antennas integrated into architectural elements, and antenna structures designed to look like another object, such as a light pole, clock towers, bell steeples, or a tree.

10. Antenna Support. Any device for supporting an antenna which is other than a tower, such as a mast, pole, or tripod.

11. Antenna Tower. The same as defined by the FCC in 47 C.F.R. Section 1.40001(b)(9), and includes any structure built for the sole or primary purpose of supporting any FCC-licensed or authorized antennas and their associated facilities, including structures that are constructed for wireless communications services, including, but not limited to, private, broadcast, and public safety services, as well as unlicensed wireless services and fixed wireless services such as microwave backhaul, and the associated site.

Applicant. Any person, firm, partnership, association, joint venture, corporation, or any other entity or combination of entities, or state or local government agency applying for a permit or approval.

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Application. A formal request to a local authority for permission, whether allowed as a matter of right or required by any permit or approval, to erect, construct, reconstruct, alter, repair or move any buildings or structure, use vacant land, or add a new use or change in use. A complete application means that the applicant has submitted all the required information in accordance with the Permit Streamlining Act, California Government Code Section 65943.

Arbor. An unenclosed structure typically constructed of latticework or metal that often provides partial shade or support for climbing plants. An arbor is not considered an accessory building. Also called a trellis or pergola.

Architectural Feature. An exterior element of a building that contributes to the visual interest or ornamentation of the building massing. Architectural features may be decorative or functional and include, but are not limited to, awnings, eaves, cornices, window and door surrounds, chimneys, towers, vents, antenna, parapets, light fixtures, and canopies. Exterior wall coverings, such as siding, plaster, and other finish materials, are also considered architectural features.

Arts. Arts are a diverse range of human activities in creating visual, auditory, or performance works, expressing the author's imaginative or technical skill, intended to be appreciated for their beauty or emotional power.

As-Built Permit. A permit requested during or after the course of construction, identifying all onsite improvements as they have been constructed.

Association, Homeowner's. The organization of persons who own a lot, parcel, area, condominium or right of exclusive occupancy in a project.

Attached. A structure which is structurally a part of or has a common wall or continuous roof with another structure, except where such connection is a breezeway or walkway incidental to and not a necessary part of the construction of the main building. See Section 30.140.030, Building Attachment.

Attic. The area located between the ceiling of the top story of a building and the building's roof. See also, Subsection 30.15.090.G, Determining the Number of Stories in a Building and Story, Half.

Average Slope. The result of dividing the length of a slope by the difference in elevation at the top and bottom of the slope. See Section 30.15.030, Determining Average Slope.

Average Unit Size. The total of the net floor area of each of the residential units in a project and divided by the number of residential units in that project. Common areas not controlled by the occupant of an individual residential unit are excluded from the average unit size.

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Awning. An architectural projection that provides weather protection, identity, or decoration. An awning is typically constructed of canvas, metal, wood, or roofing materials on a supporting framework that projects from and is wholly supported by the exterior wall of the structure to which it is attached. See also, Canopy.

30.300.080 “H”.

Habitable Space. See Floor Area, Livable.

Hardscape. Paving, decks, patios, and other hard, horizontal surfaces.

Hazardous Materials. Any material, including any substance, waste, or combination thereof, which because of its quantity, concentration, or physical, chemical, or infectious characteristics may cause, or significantly contribute to, a substantial present or potential hazard to human health, safety, property, or the environment when improperly treated, stored, transported, disposed of, or otherwise managed.

Hazardous Waste. A waste, or combination of wastes, which because of the quantity, concentration or physical and chemical characteristics may either (a) cause or significantly contribute to an increase in mortality or an increase in serious irreversible or incapacitating reversible illness, or (b) pose a substantial present or potential hazard to human health or the environment when improperly treated, stored, transported, disposed or otherwise managed. Hazardous waste also includes those materials described in Title 22, Division 4.5, Chapter 11, California Code of Regulations.

Hazardous Waste Management Plan. A plan prepared, adopted and amended from time to time, pursuant to § 25135 of the California Health and Safety Code by Santa Barbara County to direct the management of hazardous wastes within the boundaries of the County. It is also known as the Hazardous Waste Element of the Santa Barbara County Comprehensive Plan.

Hearing. A public meeting, workshop, or appeal conducted by the City in which a housing development project or land use matter is reviewed or acted upon by a decision-making body.

Includes any meeting subject to the five-hearing limit under Government Code Section 65905.5.

Heat. Thermal energy of a radioactive, conductive, or convective nature.

Hedge. A row of shrubs, bushes, or any other kind of plant material that forms a boundary or substantially continuous visual barrier. Also called Screen.

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Height. The vertical distance from a point on the ground below a structure to a point directly above. See also, Section 30.15.090, Measuring Height and Stories.

High Fire Hazard Area. The High Fire Hazard Area includes the City’s four High Fire Hazard Zones: Coastal, Coastal Interior, Extreme Foothill, and Foothill. The Extreme Foothill and Foothill zones are also designated as the “Very High Fire Hazard Severity Zone,” by the California Department of Forestry and Fire Protection and as defined in the City’s Community Wildfire Protection Plan adopted by City Council.

Historic Resources Related Definitions. The following terms are related to the rules and regulations applicable only to historic resources.

1. Adobe. An unburnt, sun-dried, clay brick; or a building made of adobe bricks.

2. Adjacent. See Abutting, as defined in Section 30.300.010.

3. Archaeological site. The location of a prehistoric or historic occupation or activity, or a building or structure, whether standing, ruined, or vanished, where the location itself possesses archaeological value regardless of the value of any existing buildings or structures. (For the protection of significant archaeological and paleontological resources within the City, please refer to Chapter 22.12, Archaeological and Paleontological Resources.)

4. Buffer Area. An area of land, developed or undeveloped surrounding a historic resource, El Pueblo Viejo Landmark District or Historic District Overlay Zones, that serves to notice owners, planners and design review boards during the planning and design review process of the necessity to plan to mitigate any negative impacts a new project may have to the historic resource. The distance requirements of the buffer area are the following: 250 feet from the outline of the structure of an original adobe, El Presidio de Santa Barbara State Historic Park and areas inclusive of the original footprint of the Presidio, or a Landmark; 100 feet from the outline of the structure around a Structure of Merit; and at least a radius of one-half block from the boundary line surrounding El Pueblo Viejo Landmark District or a historic district and shall include properties on the opposite side of the street from the district.

5. Certificate of Appropriateness. The administrative approval document issued by the City’s Architectural Historian to approve a minor alteration to a historic resource.

6. Character-Defining Feature or Element. A visible physical part or aspect of a structure or site that contributes to its identification, understanding or interpretation as an example of architecture or architectural style, as an artifact attributable to a particular period of historical significance, or as a unique entity.

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7. Compatibility. Respect for distinctive character, identity and history of a streetscape and neighborhood through historic materials, features, size, scale and proportion, and massing to protect the integrity of the environment.

8. Contributing Resource. A structure, site, or feature within the boundaries of a Historic District, or El Pueblo Viejo Landmark District, which reflects the significance of the district as a whole, either because of historic associations, historic architectural qualities, archeological features, or historic integrity, and is considered a historic resource.

9. Cultural. The concepts, habits, skills, arts, instruments, institutions, etc. of a given people in a given period.

10. Cultural Landscape. A geographic area (including both cultural and natural resources and the wildlife or domestic animals therein), associated with a historic event, activity, or person or exhibiting other cultural or aesthetic values. Refer to the Secretary of Interior’s Standards for Treatment of Cultural Landscapes for further definition of this term.

11. Cultural Resource. Districts, streetscapes, neighborhoods, sites, buildings, structures, view corridors, vistas and objects that have acquired significant associations with human activities and human events.

12. Demolition. Removal or destruction. Whenever the term demolition is used in this Title it shall also be considered a substantial redevelopment. See also, Section 30.140.200, Substantial Redevelopment. With regard to a historic resource, the term “demolition” shall also include the removal of a significant component or a character defining element.

13. Demolition by Neglect. A situation in which a property owner(s) through neglect and lack of maintenance allows a historic resource or character defining feature of a historic resource to suffer severe deterioration, potentially beyond the point of repair.

14. Elevation. The flat scale orthographically projected architectural drawing of all exterior vertical elements of a building facade.

15. Features. Natural or man-made elements on a site, examples of which include trees, fountains, walls, and designed landscapes.

16. Historic District. A geographically definable area in the City possessing a significant concentration, linkage, or continuity of structures, sites or features united by past events or aesthetically by plan or physical development. Historic Districts consist of contributing and non-contributing properties, thematically linked by architectural style or designer, date of development, distinctive urban plan, or historic associations and may include buffer zones as Inclusionary Housing Ordinance Amendments Attachment 1
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authorized by the Historic Landmarks Commission. A historic district derives its importance from being a unified entity conveying a visual sense of the overall historic environment.

17. Historic Fabric or Material. Original and later-added historically significant construction materials, architectural finishes or elements in a particular pattern or configuration which form a qualified historical property, as determined by the Historic Landmarks Commission.

18. Historic Resource. A structure, site, cultural landscape or feature designated or eligible to be designated historically significant based on the criteria in Section 30.157.025. Historic resources may also include, but are not limited to:
a. City-designated Landmark or Structure of Merit;
b. California Historical Landmark;
c. National Historic Landmark;
d. Listed on the State Register of Historical Resources; e. Listed on the National Register of Historic Places;
f. Contributing historic resources in a City-designated Historic District (HD) or Landmark District (LD) Overlay Zone;
g. State or National Register Historic District;
h. A resource listed in the City’s Local Register of Historical Resources; or i. A Cultural Landscape as defined herein.

19. Historic Resource, Exception. A property where only a small feature such as a sandstone wall, hitching post or tree is significant, as long as the feature is protected in the project. The determination of what constitutes a small feature shall be made by the staff Architectural Historian.

20. Historical Integrity. Authenticity of a building or property’s historical identity evidenced by the survival of physical characteristics that existed during the property’s historical or prehistorical period of significance.

21. Historical Significance. The degree of importance for which a property has been evaluated and found to be historical as determined by the Historic Landmarks Commission, City Council, the California Office of Historic Preservation, or Keeper of the National Register of Historic Places based on meeting specified local, state and national criteria.

22. Landmark. A structure, site, cultural landscape or feature having historic, architectural, archeological, cultural, or aesthetic significance and designated by City Council as a Landmark under the provisions in this chapter.

23. Landmark Tree. See Historic Tree in Section 15.24.010.

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24. Local Register of Historical Resources. A list of properties officially designated or recognized as historically significant by the City of Santa Barbara per the procedures outlined in Chapter 30.157, Historic Resources (formerly referred to as “Historic Resources Inventory”). Any physical modification or change to the exterior of a building, structure, site, object or designated interior that may have a significant effect on character defining features of a historic resource. A major alteration shall also include construction of additions.

25. Major Alteration. Any physical modification or change to the exterior of a building, structure, site, object, or designated interior that many have a significant effect on character-defining features of a historic resource. A major alteration shall also include construction of additions.

26. Minor Alteration. Any physical modification or change to insignificant exterior features of a historic resource, including additions, windows, doors, and exterior siding material that is nonoriginal or otherwise lacking in historic integrity.

27. Neighborhood. For purposes of this chapter, a neighborhood is defined as an area possessing a sense of cohesiveness due to of physical features suggesting boundaries or concentrations of shared architectural, historic, or cultural characteristics.

28. Nomination. The documentation by a qualified historian or architectural historian setting forth certain facts to support the designation of a historic resource as a Landmark, Structure of Merit, or HD Overlay Zone.

29. Non-Contributing Resource. A structure, site or feature within the boundaries of a HD Overlay Zone that does not qualify as a historic resource, but which has been included within the Historic District boundaries because of its geographic location with the HD Overlay Zone.

30. Ordinary Maintenance. The maintenance, painting, landscape or repair of any exterior feature in or upon any historic resource that does not involve a change in design, material, or the external appearance thereof, except that the removal of trees or the change of paint color shall not be considered ordinary maintenance.

31. Period of Significance. The period of time when a qualified historic structure, site or feature was associated with important events, activities or persons, or attained the characteristics for its listing or registration.

32. Preservation. The act or process of applying measures necessary to sustain the existing form, integrity, and materials of a qualified historic resource. Preservation work, including preliminary measures to protect and stabilize the structure, site or feature, generally focuses upon the ongoing maintenance and repair of historic materials and features rather than Inclusionary Housing Ordinance Amendments Attachment 1
Proposed Ordinance Amendments 32
extensive replacement and new construction. New exterior additions are specifically not within the scope of this treatment; however, the limited and sensitive upgrading of mechanical, electrical and plumbing systems and other code-related work to make properties functional is deemed to be appropriate preservation work.

33. Qualified Professional Staff in Historic Preservation. Staff meeting the Professional Standards in Historic Preservation outlined in the Secretary of the Interior’s Guidelines and Qualifications in History, Architectural History, or Historic Architecture in education and experience required to perform the identification, evaluation, registration, and treatment of historic resources. Referred to in this chapter as Architectural Historian.

34. Reconstruction. The act or process of depicting, by means of new construction, the form, features and detailing of a non-surviving site, landscape, building, property or object for the purpose of replicating its appearance from a specific period of time.

35. Rehabilitation. The act or process of making possible a compatible use for a qualified historic resource through repair, alterations and additions while preserving those portions or features which convey its qualified historical, cultural or architectural values.

36. Relocation. The act or process of moving any qualified historic resource or a portion of a qualified historic resource to a new site, or a different location on the same site.

37. Restoration. The act or process of accurately depicting the form, features and character of a qualified historic resource as it appeared at a particular period of time by means of the removal of features from other periods in its history and reconstruction of missing features from the restoration period. The limited and sensitive upgrading of mechanical, electrical and plumbing systems and other code required work to make properties functional is appropriate within a restoration project.

38. Sandstone Construction. A sedimentary rock (usually consisting of quartz sand particles united by some bonding agent such as silica or calcium carbonate) hewed into building materials by a skilled mason or carver and for purposes of this chapter, incorporating traditional, stone masonry, including, but not limited to, curbs, walls, railings, bridges, gardens, buildings, steps or hitching posts using local sandstone material quarried in the Santa Barbara area.

39. Secretary of the Interior’s Standards. The current version of the “Standards for Treatment of Historic Properties with Guidelines for Preserving, Rehabilitating, Restoring & Restructuring Historic Buildings” published by the U.S. Department of the Interior.

Streetscape. The design quality of the street and its visual effect and pedestrian experience.

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40. Streetscape. The design quality of the street and its visual effect and pedestrian experience.

41. Structure of Merit. A historic resource designated by the Historic Landmarks Commission that deserves official recognition as having historic, architectural, archeological, cultural, or aesthetic value but does not rise to the level of Landmark status.

End of Historic Resources Related Definitions
Household. One or more persons living together in a single residential unit, with common access to, and common use of, all living areas and all areas and facilities for the preparation and storage of food and who maintain no more than four six separate rental agreements for the single residential unit.

Housing.

1. Affordable Housing. See Affordable Housing in Affordable Housing Terms.

2. Community Benefit Housing. Residential development that has a public benefit including the following housing types:
a. Priority housing;
b. Housing affordable to Very-Low-, Low-, Moderate-, or Middle-Income households as defined in Chapter 30.160, Inclusionary Housing; and c. Transitional housing and supportive housing.

3. Employer-Sponsored Housing. Residential units which are developed, owned, maintained, and initially sold or rented to employees of a local employer (or group of employers) where each residential unit is occupied as a primary residence (as defined by federal income tax law) by a household that includes at least one person who works in the south coast region of Santa Barbara County.

4. Inclusionary Housing. See Affordable Housing. Also called an Inclusionary Unit.

5. Market-Rate Housing. A residential unit that is not deed-restricted. Market-Rate Housing is not Affordable Housing.

6. Ownership Housing. A residential unit that may be sold separately under the requirements of the State Subdivision Map Act. A residential unit may be designated as an Ownership Housing unit whether or not it is rented by the owner.

7. Priority Housing. Priority housing includes the following three categories of housing:

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a. Employer-sponsored housing;
b. Limited-equity housing cooperatives; and
c. Rental housing.

8. Rental Housing. A residential unit that is developed or maintained as one or multiple residential units on the same lot for occupancy by separate households pursuant to a lease or other rental agreements. Rental housing terms are not less than 31 consecutive days, nor shall rental housing allow termination of the tenancy prior to the expiration of at least one 31 day period occupancy by the same tenant.

Housing Development Project. See Objective Housing Development Project.

30.300.120 “L”.

Landing. An unenclosed, unroofed platform, attached to a building, and serving as a required means of egress from the first floor of a building.

Landscape Area. An area of ground within the boundaries of a lot which consists of living plant material including, but not limited to, trees, shrubs, ground covers, grass, flowers, gardens and vines.

1. Established Landscape. The point in time at which plants have developed roots into the soil adjacent to the root ball.

2. Landscape Accessories. Small-scale, unenclosed, non-habitable, and non-mechanical elements placed within landscaped or front yard areas to enhance visual interest, support outdoor use, or contribute to site aesthetics. Landscape accessories do not require a building permit unless otherwise specified. Examples may include mailboxes, flagpoles, sculptures, fountains, birdbaths, garden art, benches, and planters. The Community Development Director may determine whether an item qualifies as a landscape accessory based on its scale, function, and visual impact. Landscape accessories do not include roofed or overhead structures, enclosed structures, barbecues, firepits, loose rubbish, garbage, junk, mechanical or utility equipment, or items that create a visual, noise, or lighting nuisance.

3. Landscape Plan. Design plans prepared by a licensed landscape architect, unless exempt under California Business and Professions Code Sections 5641 through 5641.6. A landscape plan includes a planting plan, an irrigation plan (if applicable), and a completed Landscape Compliance Statement. A landscape plan may be submitted as a separate document or combined with a site plan, provided all required components are clearly identified and comply with applicable State and local requirements.

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4. Water Wise Landscape. Those plants that are evaluated as needing "low" (10-30% ETo) or "very low"(<10%vETo) amounts of irrigation water as defined and listed by Water Use Classifications of Landscape Species (WUCOLS) or other sources of water-wise plant water use classifications as verified by a licensed landscape architect. Also called a Low-Water-Use or Very-Low-Water-Use Landscape.

Limited-Equity Housing Cooperative. A corporation organized on a cooperative basis that meets the requirements of State Civil Code Section 817 and which restricts the re-sale price of the cooperative's shares in order to maintain a specified level of affordability to any new shareholder.

Livability. Considers a person’s quality of life as it pertains to their place of residence or employment. Desirable livability design features, including usable, functional, common and private open yards, access to light and air, peace and safety, and privacy from neighboring properties.

Living Room. The largest livable room in a residential unit accessible from the main entrance and shared as a common area.

Loading Spaces, Off-street. Permanently improved and maintained areas on the site dedicated to loading and unloading materials, equipment, and merchandise.

Local Employer. A person, business, company, corporation or other duly formed legal entity which employs persons whose primary place of employment is located within the south coast region of Santa Barbara County.

Lot. A parcel, tract, or area of land whose boundaries have been established by a legal instrument such as a deed or map recorded with the County of Santa Barbara, and that is recognized as a separate legal entity for purposes of transfer of Title, except public easements or rights-of-way.

Projects using Title 25 of this code may interpret the following types of “Lots” to mean “Design Sites”. See also, Parcel.

1. Lot, Corner. A lot surrounded on two or more contiguous sides by a street.

2. Lot, Flag. A lot that has access to a street by means of a narrow strip of land.

3. Lot, Interior. A lot other than a corner lot.

4. Lot, Through. A lot having frontage on two parallel or approximately parallel streets.

Lot Area. The area of a lot measured horizontally between bounding lot lines.

1. Lot Area, Gross. The total area, measured in acres, of a lot included within the lot lines.

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2. Lot Area, Net. The area of a lot measured horizontally between bounding lot lines, subtracting the existing or proposed horizontal area within any right-of-way.

Lot Frontage. See Street Frontage.

Lot Line. The boundary between a lot and other property or a public or private street. Also called a Property Line. “Lot Line” may be interpreted to mean “Design Site Line” for projects using Title 25 of this code.

1. Lot Line, Front. The line or lines dividing a lot from a public or private street. The line or lines that divide a lot from an alley or a driveway shall not be considered front lot lines. On lots that abut multiple streets, all lines that divide the lot from a street shall be considered front lot lines. Design Sites that do not abut a street shall designate a Front Design Site Line consistent with Section 25.02.040, Design Sites, for projects using Title 25 of this code. a) Lot Line, Primary Front. Front lot line adjacent to primary front yard. b) Lot Line, Secondary Front. Front lot line adjacent to secondary front yard.

2. Lot Line, Interior. Any lot line other than a front lot line.

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FIGURE 30.300.120: LOTS AND LOT LINES
Lot Line Adjustment. The adjustment of the boundary of existing parcels where the number of parcels existing after the adjustment is the same as the number of parcels that existed prior to the adjustment.

Low Barrier Navigation Center. A facility as defined in Government Code § 65660(a) that meets all of the requirements of Government Code § 65660 et seq. Includes a “Low Barrier” Social Service Facilities (with or without temporary living facilities), and a “Low Barrier” Emergency Shelter provided all the other requirements of Government Code § 65660 et seq. are met.

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30.300.180 “R”.

Rear. Opposite of front. In the event of two or more fronts, the rear shall be provided from the opposite to any of the fronts.

Recreational Vehicles.

1. Recreational Vehicle. A motor home, slide-in camper, travel trailer, or camping trailer, with or without motive power, designed for human habitation for recreational or emergency occupancy.

2. Recreational Vehicle Space. That portion of a recreational vehicle park set aside and designated for the occupancy of one recreational vehicle, including any contiguous area designed or used for automobile parking, carport, storage, awning, cabana or other use which is clearly incidental and accessory to the primary use of the space.

3. Camping Trailer. A vehicular portable unit mounted on wheels and constructed with collapsible partial sidewalls which fold for towing by another vehicle and unfold at the campsite and designed for human habitation for recreational or emergency occupancy.

4. Motor Home. A vehicular unit built on or permanently attached to a self-propelled motor vehicle chassis, chassis cab or van, which becomes an integral part of the completed vehicle, designed for human habitation for recreational or emergency occupancy.

5. Slide-In Camper. A portable unit, consisting of a roof, floor and sides, designed to be loaded onto and unloaded from the bed of a pickup truck, and designed for human habitation for recreational or emergency occupancy and shall include a truck camper.

6. Travel Trailer. A portable unit, mounted on wheels, of such a size and weight as not to require special highway movement permits when drawn by a motor vehicle and for human habitation for recreational or emergency occupancy.

Remodel. See Alteration.

Renovation. See Alteration.

Repair and Maintenance. The replacement of existing materials with similar materials in a similar manner. Repair and maintenance does not include: additions, alterations, or substantial redevelopment to any structure; changes in site development; a substitution of or a change to a nonconforming use; or an increase in area occupied by a nonconforming use.

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Replacement in Kind. The replacement of a structure or an architectural element that is identical to the original in location, size, and shape, and is constructed of materials that outwardly match the original in dimensions, proportions, details, and textures. The replacement must result in no visible change to the architectural style or appearance of the element. Also referred to as Like-for-Like Replacement.

Residential. Lands, buildings, structures or portions thereof used, or designed for use, as a home or residence of one or more individuals.

Residential Property. Any real property, zoned, designed or allowed to be used for any residential purpose, including any buildings or structures located on said improved real property. Also called Residential Development.

Residential Unit. Any building or portion thereof that contains living facilities, including provisions for sleeping, eating, cooking, and sanitation, for not more than one household. Also called Dwelling Unit. See Section 30.140.150, Residential Unit.

Residential Use of the Same Type. A residential use that occupies a building type (e.g., single-unit residence, duplex, multi-unit residence) that is otherwise allowed in the same zoning district.

Transitional housing, supportive housing, community care facilities, residential care facilities for the elderly, hospices, and licensed small and large family day care homes are subject only to the same zoning standards (e.g., setbacks, height, parking) that apply to other residential dwellings of the same building type in the same zone.

Review Authority. The highest decision-making body identified for any land use permit responsible for making decisions on zoning and related permits and approvals, including, but not limited to, the Community Development Director, Public Works Director, design review bodies, Staff Hearing Officer, Planning Commission, and City Council.

Right-of-Way (ROW). A strip of land acquired by reservation, easement, dedication, forced dedication, prescription or condemnation and intended to be occupied or occupied by a street, railroad, electric transmission lines, oil or gas pipeline, water line, sanitary storm sewer or other similar use.

Roof. The top covering of a building, principally responsible for providing protection from the elements.

30.300.190 “S”.

Screen. See Hedge.

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Semi-Public Use. A facility that is open to the public and has a public purpose but is not owned or operated by a governmental entity. Also called Quasi-Public Use.

Setback. The distance by which a building, structure, use, parking area, or other site or development feature is separated from a lot line or design site line. See also, Section 30.15.060, Measuring Distances, Section 30.15.100, Measuring Setbacks and Stepbacks, and Section 30.140.090, Encroachments. References to “Lot Lines” may be interpreted to mean “Design Sites Lines” for projects using Title 25 of this code.

1. Setback, Front. An area extending across the full width of the lot, parallel to the front lot line, extending between the interior lot lines.

2. Setback, Interior. An area between an interior lot line and a line parallel to the interior lot line, bounded by the two lot lines adjacent to the interior lot line from which the setback is measured.

3. Setback, Primary Front. Setback adjacent to primary front lot line.

4. Setback, Secondary Front. Setback adjacent to secondary front lot line.

Shopping Center. An integrated group of commercial establishments that are planned and managed together with a minimum of five attached businesses and shared onsite parking. Shopping Centers can include a variety of uses including, but not limited to: retail, eating and drinking establishments, small offices, and banks.

Sidewalk. A paved, surfaced, or leveled area, paralleling and usually separated from the street, used as a pedestrian pathway.

Sink. A sink is a fixed bowl or basin equipped with running water and a drain, used for washing, rinsing, or other utility purposes.

1. Sink, Bar. A bar sink is a compact sink used for beverage preparation or light clean-up in a wet bar or similar setting. To avoid classification as a full kitchen for zoning purposes, a bar sink must not exceed 12 inches in interior basin width and must not be associated with more than five linear feet of countertop, including any adjacent cabinetry or work surface. Bar sinks are not intended for food preparation, dishwashing, or personal hygiene. The presence of a bar sink does not, by itself, constitute a kitchen.

2. Sink, Kitchen. A kitchen sink is a plumbing fixture used for food preparation, dishwashing, or cleaning of kitchen-related items. A kitchen sink is typically located in a kitchen or food preparation area and must have an interior basin size greater than 12 inches by 12 inches. The Inclusionary Housing Ordinance Amendments Attachment 1
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presence of a kitchen sink, in combination with other elements such as a cooking appliance and food preparation counter, may constitute a kitchen for zoning purposes.

3. Sink, Lavatory. A lavatory sink, or lavatory, is a plumbing fixture designed specifically for handwashing and personal hygiene. A lavatory sink must be located within a bathroom and is not intended for food preparation, dishwashing, or utility use.

4. Sink, Utility. A deep, durable plumbing fixture intended for cleaning tools, rinsing equipment, or performing household maintenance tasks. Utility sinks are commonly located in garages, laundry rooms, or service areas and are not intended for food preparation or personal hygiene.

Site Plan. A plan sheet that includes the basic information that will appear on all plans including, but not limited to, lot lines, natural features, roads, buildings, or other structures proposed or existing to remain on-site. Also called plot plan.

Site. A lot, or group of contiguous lots, that is proposed for development in accordance with the provisions of this Title and is in a single ownership or under unified control. Also called development site, or project site. See also, Building Site.

Skylight. Roof-mounted window allowing light and sometimes ventilation into the space below.

Solar Access Height Related Definitions. The following terms are related to Section 30.140.170, Solar Access Height Limitations.

1. Base Elevation Point. The elevation of the higher of either (1) the highest point of contact of a structure with existing grade or (2) the highest point of existing grade along the northerly lot line on the subject property measured at the location(s) with the shortest distance from the structure to the northerly lot line. For the purposes of this determination, all fences, covered and uncovered walkways, driveways, patio covers, and other similar elements shall be considered separate structures.

2. Northerly Lot Line. Any lot line, of which there may be more than one per lot, that forms a generally north facing boundary of a lot and has a bearing greater than or equal to 40 degrees from either true north or true south. For curved lot lines, the bearing of the lot line at any point shall be the bearing of the tangent to the curve at that point.

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FIGURE 30.300.190: NORTHERLY LOT LINE

3. Plan View. A plot plan of the parcel which shows the horizontal dimensions of a parcel and each structure on the parcel.

4. Shadow Plan. A plot plan which shows the extent of shading caused by a proposed structure.

5. Solar Access. The ability of a location to receive direct sunlight.

State. The State of California.

Stepback. The upper portion of a building that is required to be set (or stepped) further back than the minimum setback. See also, Section 30.15.100, Measuring Setbacks and Stepbacks.

Stock Cooperative. As defined in § 11003.2 of the Business and Professions Code.

Story. That portion of a building included between the surface of any floor and the surface of the floor next above it, except that the topmost story shall be that portion of a building included Inclusionary Housing Ordinance Amendments Attachment 1
Proposed Ordinance Amendments 43
between the surface of the topmost floor and the surface of the roof above. See also, Section

30.15.090.G, Determining the Number of Stories in a Building.

1. Story, First. The lowest story or the ground story of any building, that is closest to finished grade. Also called First Floor or Ground Floor.

2. Story, Half. A conditioned space that rests underneath the slope of the roof, usually having dormer windows. Where applicable, the half-story is identified by the "0.5" in the description of maximum height (e.g., 2.5). A half-story is not counted as a whole story when its top wall plates, on at least two opposite exterior walls, are less than four feet above the floor of such story. Also called Attic Half-Story.

3. Story, Mezzanine. A story which covers one-third or less of the area of the story directly underneath it. A mezzanine story shall be deemed a full story when it covers more than onethird of the area of the story directly underneath said mezzanine story.

4. Story, Second. The story above the First Story. Also called Second Floor.

5. Story, Upper. Any story above the first story.

Street. A public or private way constructed for the primary purpose of vehicular travel. An alley or a driveway is not a street. The term “street” describes the entire legal right-of-way or easement (public or private), including, but not limited to, the traffic lanes, bike lanes, curbs, gutters, sidewalk whether paved or unpaved, parkways, and any other grounds found within the legal right-of-way. The name given to the right-of-way (avenue, court, road, etc.) is not determinative of whether the right-of-way is a street.

1. Street, Private. A street that is privately owned. Private streets do not appear on the official dedicated street map of the City of Santa Barbara. Private streets generally provide access to multiple lots or units and are usually named, unlike driveways. Private streets may be constructed to public street standards. Private streets are generally differentiated from driveways by larger widths, longer lengths, and may include public or private utilities. Also called a Private Road, Lane, or Drive.

2. Street, Public. Any street shown on the official dedicated street map of the City of Santa Barbara, as such map may be amended from time to time.

Street Frontage. The length of the front lot line along an adjacent street.

Structural Alteration. Any change affecting existing structural elements or requiring new structural elements for vertical or lateral support of an otherwise nonstructural alteration. Includes any physical Inclusionary Housing Ordinance Amendments Attachment 1
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change to the supporting members of a structure, such as bearing walls, columns, beams or girders, floor joists or roof joists, including the creation, or enlargement, of doors or windows and changes to a roofline or roof shape.

Structure. Anything constructed or erected and the use of which requires more or less permanent location on the ground or attachment to something having a permanent location on the ground.

Buildings are considered structures.

1. Structure, Accessory. A subordinate structure, physically detached from, and used only as incidental to the main structure on the same lot. See also, Building, Accessory.

2. Structure, Ground-Mounted. Any object, structure, equipment, or feature that is intended, designed, and placed directly on a horizontal surface and is not physically attached to a building wall or roof. Ground-mounted encroachments may rest on natural grade, finished grade, or an on-grade surface such as a deck, podium, or terrace, provided the surface is designed to support such features and is accessible from the adjacent exterior space. Examples include, but are not limited to, freestanding mechanical equipment, trash enclosures, pergolas, playground equipment, rainwater tanks, fountains, sheds.

3. Structure, Main. See Building, Main.

4. Structure, Roof-Mounted. Any object, structure, equipment, or feature that is intended, designed, and affixed to or supported by the roof of a building. Roof-mounted encroachments are elevated above the highest occupied floor and may include solar panels, skylights, roof decks, satellite dishes, chimneys, and antennae.

5. Structure, Wall-Mounted. Any object, structure, equipment, or feature that is intended, designed, and affixed to a vertical building wall and projects outward from the wall surface.

Wall-mounted encroachments do not rest on grade or any horizontal surface. Examples include, but are not limited to, utility meters, conduit, signage, exterior light fixtures, and wallmounted electric vehicle supply equipment (EVSE).

Studio. A residential unit consisting of one combined living and sleeping room. The unit may have a separate kitchen and bathroom in addition to the main room. A studio may have a loft, but the loft may not be a bedroom, as defined in this Title.

Subdivision. The subdivision of land into individual lots. As defined in Article 2, Chapter 1 of the Subdivision Map Act. See also Title 27, Subdivisions.

1. Subdivision, Condominium. See Condominium.

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2. Subdivision, Lot-Only. The subdivision of land into individual lots intended to be sold as vacant land, with or without improvements such as rights-of-way or utilities, but without construction of occupiable buildings.

3. Subdivision, Lot with Development. The subdivision of land into individual lots with improvements, infrastructure, and construction of occupiable buildings.

Substantial Redevelopment. A majority of a structure is removed, or is no longer a necessary and integral component of the overall structure. See Section 30.140.200, Substantial Redevelopment.

Swimming Pool, Public or Private. Any pool, pond, lake, or open tank located within or outside of a building and containing or normally capable of containing water to a depth at any point greater than 1.5 feet.

Section 9
Sections 30.150.110, 30.150.120, 30.150.130, 30.150.140 and 30.150.150 of Chapter 30.150 of Title 30 of the Santa Barbara Municipal Code are deleted.

Section 10
Uncodified. Severability
If any provision of this Ordinance or the application thereof to any persons or circumstances is held invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application and, to this end, the provisions of this Ordinance are hereby declared to be severable.

Section 11
Uncodified. California Environmental Quality Act
Environmental review under the California Environmental Quality Act (CEQA) was conducted for this action as part of the Housing Plan Program EIR (SCH 2022040209). No increase in development impacts on the environment would result under the ordinance amendments pursuant to CEQA Guidelines §15162 criteria, and no additional CEQA document is required. City Council environmental findings made for Housing Plan Inclusionary Housing Ordinance Amendments Attachment 1
Proposed Ordinance Amendments 46
adoption continue to apply with this ordinance implementation measure. [CEQA Guidelines 15168] The proposed Inclusionary Housing ordinance does not directly approve or authorize any specific construction, nor does it grant entitlements or directly result in any physical changes to the environment.

Section 12
Uncodified. Typographical Errors.

The Clerk of the City of Santa Barbara is authorized to make corrections of grammatical or typographical errors.

Section 13
Uncodified. Operative Date.

Notwithstanding the effective date of the ordinance as set forth in Charter section, 514, in order for the City Administrator, or designee, to undertake pre-implementation actions, the substantive provisions of this ordinance shall become operative on February 1, 2027. Before the operative date, the City Administrator, or designee, may take all actions necessary to implement this ordinance, including development of administrative procedures, forms, and licensing systems. 1 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Attachment 2. Implementing the Study Recommendations
Study Recommendations
The Inclusionary Housing and In-Lieu Fee Study (2026) is available on the Inclusionary Housing Requirements webpage SantaBarbaraCA.gov/Inclusionary-Housing-Requirements.

Table 1. Inclusionary Housing and In-Lieu Fee Study Recommendations Study Recommendation
Recommendation C.

Update the In-Lieu Fee Rate for Rental
Projects with 10+ units.

Recommendation E.

Set a Lower In-Lieu Fee Rate for “Small”
Rental and Ownership Projects.

Recommendation to set an in-lieu fee rate of
$35.00 per sq. ft. for projects with fewer than
10 units.

Recommendation F.

Count Rental Inclusionary Units as Bonus
Density.

Recommendation to count rental
inclusionary units as bonus density.

Option G.1.

Consider In-Lieu Fee Payment for All
Fractional Inclusionary Requirements.

Recommendation A.

Apply Inclusionary Housing Requirements
to All Rental Projects with 5+ units.

Recommendation to apply rental inclusionary
requirements to all rental projects, not only
Average Unit-Size Density Incentive Program
(AUD Program) projects.

Recommendation to increase the in-lieu fee
rate charged on rental projects of 10 or more
units from the current $25.00 per square foot
(sq. ft.) to $50.00 per sq. ft.

Recommendation to allow in-lieu fee
payments for all fractional inclusionary
requirements (0.1 through 0.9) rather than
requiring fractions of 0.5 to round up to
another on-site inclusionary unit.

Description
Recommendation B.

Maintain Current Inclusionary Housing
Requirements.

Recommendation D.

Set an In-Lieu Fee Rate for Ownership
Projects with 10+ units.

Recommendation to maintain the existing
inclusionary housing requirements for
ownership unit projects (15 percent of total
units as affordable to Middle-Income
households or Upper-Middle-Income
households) and rental unit projects (ten
percent of total units as affordable to
Moderate-Income households).

Recommendation to set the in-lieu fee rate
charged on ownership projects of 10 or more
units at $50.00 per sq. ft.

2 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Study Recommendation
Option G.2.

Consider In-Lieu Fee Payment for All
Inclusionary Requirements.

Recommendation H.

Simplify In-Lieu Fee Calculations for
Ownership Projects.

Recommendation I.

Implement Automatic Annual In-Lieu Fee
Rate Adjustments.

Recommendation J.

Adjust Target AMI for Moderate-Income
Rents from 100 percent to 110 percent.

Description
Recommendation to allow an in-lieu fee
payment to satisfy all inclusionary
requirements using higher in-lieu fee rates
than proposed in Recommendation C or
Recommendation D.

Recommendation to change the ownership
in-lieu fee payment calculation method to
match the existing rental in-lieu fee payment
calculation.

Recommendation to annually adjust the inlieu fee rates for inflation using the Consumer Price Index (CPI-U).

Recommendation to align maximum rent
calculation for Moderate-Income households
with those used by the State and other
jurisdictions.

Guidance from Public Hearings
Hyperlinks to materials presented at past public hearings are provided below. • Guidance on Study Recommendations: Planning Commission (April 16, 2026) o Staff Report
o The agenda item begins approximately 22 minutes into the Video recording o Approved Minutes
• Guidance on Study Recommendations: City Council (May 5, 2026) o Council Agenda Report begins on page 25 of the Council Agenda Packet o The agenda item begins approximately 32 minutes into the Video recording • Recommend Ordinance Amendments: Planning Commission (August 20, 2026) o Staff Report
o The agenda item begins approximately 8 minutes into the Video recording o Approved Minutes
The following table summarizes the guidance and revisions to the Study Recommendations provided by the Planning Commission and City Council at public hearings in Spring 2026.

3 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Table 2. Guidance from the Planning Commission and the City Council on the Study Recommendations
Study
Recommendation
Planning Commission
(April 16, 2026)
City Council
(May 5, 2026)
Recommendation A.

Apply Inclusionary
Housing Requirements
to All Rental Projects
with 5+ units.
[Revised] Unanimous support
for applying to all multi-unit
residential projects with 2+
units
[Study] Unanimous support
Recommendation B.

Maintain Current
Inclusionary Housing
Requirements.
[Study] Support by majority
(Baucke dissent)
[Study] Supported by majority
(Sneddon dissent)
Recommendation C.

Update the In-Lieu Fee
Rate for Rental Projects
with 10+ units.
[Revised] Unanimous support [Study] Majority supported
$50.00 per sq. ft.
(Sneddon dissent, Santamaria
abstain)
using the maximum fee rate of
$91.41 per sq. ft. from the
Residential Nexus Study
Recommendation D.

Set an In-Lieu Fee Rate
for Ownership Projects
with 10+ units.
[Revised] Unanimous support
using the maximum fee rate of
$72.53 per sq. ft. from the
Residential Nexus Study
[Study] Majority supported
$50.00 per sq. ft.
(Sneddon dissent, Santamaria
abstain)
Recommendation E.

Set a Lower In-Lieu Fee
Rate for “Small” Rental
and Ownership
Projects.
[Revised] Unanimous support
using a fee rate of $50.00 per sq.
ft.
[Study] Majority supported
$35.00 per sq. ft.
(Sneddon dissent, Santamaria
abstain)
Recommendation F.

Count Rental
Inclusionary Units as
Bonus Density.
[Study] Unanimous support [Study] Unanimous support
Option G.1.

Consider In-Lieu Fee
Payment for All
Fractional Inclusionary
Requirements.

N/A [Study] Supported by majority
(Santamaria dissent, Sneddon
abstain)
Option G.2.

Consider In-Lieu Fee
Payment for All
Inclusionary
Requirements.
[Revised] Unanimous support
using the maximum fee rates
($91.41 per sq. ft. for rental
projects and $72.53 per sq. ft.
for ownership projects). Cited
increased flexibility for
[Revised] Majority supported
additional outreach and for
staff to return with additional
information
(Santamaria dissent)

4 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Study
Recommendation
Planning Commission
(April 16, 2026)
City Council
(May 5, 2026)
applicants to satisfy
inclusionary housing
requirements.

Recommendation H.

Simplify In-Lieu Fee
Calculations for
Ownership Projects.
[Study] Unanimous support [Study] Unanimous support
Recommendation I.

Implement Automatic
Annual In-Lieu Fee Rate
Adjustments.
[Revised] Unanimous support to
adjust fee rates for inflation with
a request for further analysis
into ENR and CCCI rates
[Revised] Unanimous support
for CCCI
Recommendation J.

Adjust Target AMI for
Moderate-Income
Rents from 100 percent
to 110 percent.
[Study] Unanimous support [Study] Unanimous support
Implementing the Study Recommendations
Each Study recommendation supported by the City Council and Planning Commission is incorporated into the proposed amendments.

Recommendation A. Apply Inclusionary Housing Requirements to All Rental Projects with 5+ units.
• City Council: Unanimously supported Recommendation A. • Planning Commission: Unanimously supported a revised requirement to apply inclusionary housing requirements to all rental projects of two or more units.

The proposed amendments consolidate all inclusionary housing requirements (rental and ownership) into a single location (Chapter 30.160) so that they apply to all rental projects in the City, not solely those using the Average Unit-Size Density Incentive Program (AUD Program).

The proposed amendments implement City Councilʼs recommendation to apply rental requirements to projects with five or more units because that maintains better feasibility for very small rental projects (two to four units).

Recommendation B. Maintain Current Inclusionary Housing Requirements. • City Council: Majority supported Recommendation B (Sneddon dissented). • Planning Commission: Majority supported Recommendation B (Baucke dissented).

5 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
The proposed amendments maintain the current inclusionary housing requirements for ownership projects (15% for Middle-Income Households for projects of two or more units) and rental projects (10% for Moderate-Income Households for projects of five or more units).

Recommendation C. Update the In-Lieu Fee Rate for Rental Projects with 10+ units. • City Council: Majority supported the Studyʼs recommended fee rate of $50.00 per sq. ft. for fractional requirements (Sneddon dissented, Santamaria abstained). • Planning Commission: Unanimously supported the maximum legal fee rate of $91.41 per sq. ft. for fractional requirements.

The proposed amendments (through an updated Fee Resolution) update the inclusionary housing in-lieu fee rate to $50.00 per sq. ft. for fractional requirements for rental projects of 10 or more units. The proposed amendments implement City Councilʼs recommended fee rate because that maintains better feasibility for projects.

Recommendation D. Set an In-Lieu Fee Rate for Ownership Projects with 10+ units. • City Council: Majority supported the Studyʼs recommended fee rate of $50.00 per sq. ft. for fractional requirements (Sneddon dissented, Santamaria abstained). • Planning Commission: Unanimously supported the maximum legal fee rate of $72.53 per sq. ft. for fractional requirements.

The proposed amendments (through an updated Fee Resolution) set the inclusionary housing in-lieu fee rate at $50.00 per sq. ft. for fractional requirements for ownership projects of 10 or more units. The proposed amendments implement City Councilʼs recommended fee rate because that maintains better feasibility for projects.

Recommendation E. Set a Lower In-Lieu Fee Rate for “Small” Rental and Ownership Projects.
• City Council: Majority supported the Studyʼs recommended fee rate of $35.00 per sq. ft. (Sneddon dissented, Santamaria abstained).
• Planning Commission: Unanimously supported a fee rate of $50.00 per sq. ft.

The proposed amendments (through an updated Fee Resolution) set the inclusionary housing in-lieu fee rate at $35.00 per sq. ft. for fractional requirements for both rental and ownership projects proposing fewer than 10 units. The proposed amendments implement City Councilʼs recommended fee rate because that maintains better feasibility for small projects (less than 10 units).

6 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Recommendation F. Count Rental Inclusionary Units as Bonus Density. • City Council and Planning Commission: Unanimously supported.

The proposed amendments change how rental inclusionary housing units are counted. The amendments allow the inclusionary units to be above allowed maximum residential densities.

This aligns the procedures for ownership and rental inclusionary requirements to allow all inclusionary units as “bonus” density.

Option G.1. Consider In-Lieu Fee Payment for All Fractional Inclusionary Requirements. • City Council: Majority supported allowing all fractional requirements to be satisfied with an in-lieu fee payment at the Studyʼs recommended fee rate of $50.00 per sq. ft. (Santamaria dissented, Sneddon abstained).
• Planning Commission: Did not directly address Option G.1, but their unanimous support of Option G.2 assumes support of Option G.1.

The proposed amendments change rounding requirements for fractional inclusionary housing requirements for on-site units to allow all fractional remainders to be satisfied with an inclusionary housing in-lieu fee payment. This change means all projects with a remainder of

0.5 or above no longer have to round up the quantity of on-site inclusionary housing units.

Option G.2. Consider In-Lieu Fee Payment for All Inclusionary Requirements. • City Council: Majority directed staff to conduct additional outreach and research into allowing in-lieu fee payments to satisfy all inclusionary housing requirements (Santamaria dissented).
• Planning Commission: Unanimously supported allowing all inclusionary housing requirements to be satisfied with an in-lieu fee payment at the maximum legal fee rates of $91.41 per sq. ft. for rental projects and $72.53 per sq. ft. for ownership projects.

Staff conducted additional outreach aboutOption G.2 and did more research, per City Councilʼs direction. Focus group participants supported Option G.2 to allow applicants to fully satisfy inclusionary housing requirements with a fee payment, although there was no consensus on the appropriate fee rates. Additional financial feasibility analysis was conducted by BAE Urban Economics (Attachment 4) using the fee rates supported by Planning Commission. Aligned with the stated preference to prioritize creation of on-site inclusionary housing units, the analysis shows that paying a fee and not building any on-site inclusionary units is less financially feasible in the studied prototypes. This means, based solely on financial feasibility, a development would be more likely to construct the inclusionary units than pay the fee, which

7 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
aligns with the stated priority to prioritize on-site units. Other jurisdictions that allow fee payment to fulfill inclusionary housing requirements tend to handle it in one of two ways:
allowed with decision-maker approval or allowed by-right as an alternative compliance method.

Staff recommends allowing for a 100% in-lieu fee (rebranded as an “offset fee”) and setting the offset fee rate at $91.00 per sq. ft. for rental projects and $72.00 per sq. ft. for ownership projects, which are the whole dollar maximums supported by the Residential Nexus Analysis (Appendix D of the Study). The Residential Nexus Analysis identified the “legal maximum fee” by documenting the nexus relationship between the construction of new market-rate residential units, the need for affordable housing, and the need for funds to construct affordable housing. These fee rates are the highest legally defensible amount the City could charge and were not calibrated for feasibility impacts on development. The proposed offset fee rates are rounded down to the nearest whole dollar, which serves two purposes: 1) to align with the whole dollar format of existing Planning Division fees, and 2) the slightly lower fee rates accommodate unforeseen but potential overlap of future fees that could be enacted to support affordable housing. Due to continuing legislative efforts by the State to streamline housing project permitting, which, among other things, limits the total number of hearings allowed for a housing project, staff proposes to allow the offset fee payment by-right (without approval at a hearing) as an alternative method of compliance. This means no discretionary review and no public hearing would be required for an applicant to satisfy inclusionary housing requirements with an offset fee payment.

The proposed amendments allow the inclusionary housing requirements to be fully satisfied by payment of a fee, called an inclusionary housing offset fee, as an alternate compliance method rather than requiring construction of inclusionary housing units.

Recommendation H. Simplify In-Lieu Fee Calculations for Ownership Projects. • City Council and Planning Commission: Unanimously supported.

The proposed amendments revise the in-lieu fee calculation method for ownership projects to match the existing calculation method used for rental projects.

Recommendation I. Implement Automatic Annual In-Lieu Fee Rate Adjustments. • City Council: Unanimously supported using the California Construction Cost Index (CCCI) to annually adjust the fee rates for construction cost increases. • Planning Commission: Unanimously supported annually adjusting the fee rates for construction cost increases but requested research into alternative cost indexes.

8 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
The proposed amendments add the inclusionary housing fee rates to the Cityʼs Fee Schedule.

Including the fee rates in the Fee Schedule means the rates will be adjusted annually to account for construction cost increases because the Fee Schedule is updated every year as part of the budget adoption process. The fee rates will be evaluated in the Spring and adjusted based on the annual percentage (change from December to December each year) in the California Construction Cost Index published online by the California Department of General Services.

The annual adjustment to the inclusionary housing in-lieu and offset fee rates will be based on the following inputs and formulas:

Annually Adjusted In-Lieu Fee Rate = Current Fee Rate + (Current Fee Rate x Inflation Adjustment) Inflation Adjustment = Annual Percentage from California Construction Cost Index Recommendation J. Adjust Target AMI for Moderate-Income Rents from 100 percent to 110 percent.
• City Council and Planning Commission: Unanimously supported.

The proposed amendment changes the Target Income Percent for City Inclusionary Program for Rental Projects in the Affordable Housing Policies and Procedures. This amendment helps to align the maximum rent calculations for Moderate-Income units in the City of Santa Barbara with the State and other peer jurisdictionsʼ calculation methods.

Implementation Matrix
The implementation matrix identifies the regulating documents (Santa Barbara Municipal Code, Affordable Housing Policies and Procedures, or Fee Schedule) proposed for amendment to incorporate the Study Recommendations.

Table 3. Proposed Amendments to Implement the Supported Study Recommendations Study
Recommendation
Santa Barbara
Municipal Code
Affordable
Housing Policies
and Procedures Fee Schedule
Recommendation A.

Apply Inclusionary
Housing Requirements
to All Rental Projects
with 5+ units.

Section 30.160.030,
Inclusionary Housing
Requirements

N/A N/A
Recommendation B.

Maintain Current
Inclusionary Housing
Requirements.

Section 30.160.030,
Inclusionary Housing
Requirements
Appendix H.

Example
Inclusionary
N/A

9 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Study
Recommendation
Santa Barbara
Municipal Code
Affordable
Housing Policies
and Procedures Fee Schedule
Housing
Calculations
Recommendation C. Section 30.160.030, Appendix H. Community Update the In-Lieu Fee Inclusionary Housing Example Development Rate for Rental Projects Requirements Inclusionary Department:
with 10+ units. Section 30.160.050,
Inclusionary Housing InLieu Fees
Housing
Calculations
Planning, and
Building and
Safety Fees
Recommendation D. Section 30.160.030, Appendix H. Community Set an In-Lieu Fee Rate Inclusionary Housing Example Development for Ownership Projects Requirements Inclusionary Department:
with 10+ units. Section 30.160.050,
Inclusionary Housing InLieu Fees
Housing
Calculations
Planning, and
Building and
Safety Fees
Recommendation E.

Set a Lower In-Lieu Fee
Rate for “Small” Rental
and Ownership
Projects.

Section 30.160.030,
Inclusionary Housing
Requirements
Section 30.160.050,
Inclusionary Housing InLieu Fees
Appendix H.

Example
Inclusionary
Housing
Calculations
Community
Development
Department:

Planning, and
Building and
Safety Fees
Recommendation F. Section 30.160.030, N/A N/A
Count Rental Inclusionary Housing
Inclusionary Units as Requirements
Bonus Density.

Option G.1.

Consider In-Lieu Fee
Payment for All
Fractional Inclusionary
Requirements.

Section 30.160.030,
Inclusionary Housing
Requirements
Section 30.160.050,
Inclusionary Housing InLieu Fees
Appendix H.

Example
Inclusionary
Housing
Calculations
Community
Development
Department:

Planning, and
Building and
Safety Fees
Option G.2. Section 30.160.060, Appendix H. Community
Consider In-Lieu Fee Alternative Compliance Example Development Payment for All Inclusionary Department:

Inclusionary Housing Planning, and
Requirements. Calculations Building and
Safety Fees
Recommendation H.

Simplify In-Lieu Fee
Section 30.160.050,
Inclusionary Housing InLieu Fees
Appendix H.

Example
Inclusionary
Community
Development
Department:

10 Inclusionary Housing Ordinance Amendments Attachment 2 Implementing the Study Recommendations
Study
Recommendation
Santa Barbara
Municipal Code
Affordable
Housing Policies
and Procedures Fee Schedule
Calculations for
Ownership Projects.

Housing
Calculations
Planning, and
Building and
Safety Fees
Recommendation I.

Implement Automatic
Annual In-Lieu Fee Rate
Adjustments.

Section 30.160.050,
Inclusionary Housing InLieu Fees
Community
Development
Department:

Planning, and
Building and
Safety Fees
Recommendation J.

Adjust Target AMI for
Moderate-Income Rents
from 100 percent to 110
percent.

N/A Table 2.

Affordable
Housing
Programs in the
City
N/A

1 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
Attachment 3. Explanation of Revisions in the Proposed Amendments The proposed amendments are a package of amendments to multiple titles of the Santa Barbara Municipal Code, the Fee Schedule, and the Affordable Housing Policies and Procedures.

In preparation for updated federal accessibility requirements, underline-and-strikeout redlines are no longer used to show proposed ordinance changes. The proposed amendments are shown as new text only (Attachment 1) and described in more detail in Attachment 2 and Attachment 3.

The proposed Fee Schedule and Affordable Housing Policy and Procedure amendments will be provided at the Introduction hearing at City Council, as they are amended by Council resolution and do not require Ordinance Committee recommendation. No action is requested on the Fee Schedule or Affordable Housing Policy and Procedure amendments as part of this agenda item; included content is purely informational.

Existing Regulations
The existing regulations that are proposed for amendment are hyperlinked below for reference.
• Santa Barbara Municipal Code
o Section 25.02.030, General Requirements
o Section 26.80.030, Funding Sources
o Chapter 28.43, Inclusionary Housing Ordinance
o Section 30.15.050, Fractions
o Sections 30.150.020, 30.150.080, 30.150.110, 30.150.120, 30.150.130,

30.150.140, and 30.150.150 in the Average Unit-Size Density Incentive Program o Chapter 30.160, Inclusionary Housing
o Section 30.185.045, Adaptive Reuse Projects
o Sections 30.300.010, 30.300.080, 30.300.120, 30.300.180,and 30.300.190 in Definitions
• Fee Schedule, Fiscal Year 2026-2027

2 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
• Affordable Housing Policies and Procedures
Explanation of Changes
The following is a summary of changes to the existing regulations and the proposed amendments to the Santa Barbara Municipal Code, Fee Schedule, and Affordable Housing Policies and Procedures.

Santa Barbara Municipal Code
The majority of the inclusionary housing ordinance amendments package are proposed amendments to the Santa Barbara Municipal Code.

Title 25 Objective Design and Development Standards
Amend Section 25.02.030, General Requirements
Update municipal code references in Subsection 25.02.030.E, Inclusionary Housing.

Title 26 Housing Regulations
Amend Section 26.80.030, Funding Sources
Update municipal code references in Subsection 26.80.030.B, Ongoing Revenue.

Title 28 Zoning—Coastal
Amend Chapter 28.43, Inclusionary Housing Ordinance
Chapter 28.43, Inclusionary Housing Ordinances amended to direct to inclusionary housing requirements in the proposed Chapter 30.160, Inclusionary Housing.  Section 28.43.010, Purpose and Intent
Consolidated into proposed Section 30.160.010, Purpose.  Section 28.43.020, Definitions
All definitions were removed from Section 28.43.020 and moved into Chapter 30.300, Definitions. Specific edits are described below. See Exhibit D of the August 20, 2026 Planning Commission Staff Report for proposed definition amendments.

3 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
− Section 30.300.080, “H” under “Housing”
o Inclusionary Unit (renamed “Inclusionary Housing”)
o Market-Rate Unit (renamed “Market-Rate Housing”)
o Ownership Unit (renamed “Ownership Housing”)
− Section 30.300.190, “S”
o Residential Lot Subdivision – existing defined term, renamed to “Subdivision” The following terms are already defined in Chapter 30.300, Definitions:
− Applicant – existing defined term in Section 30.300.010, “A” − Household – existing defined term in Section 30.300.080, “H” − Residential Development – existing defined term “Development” in Section 30.300.040, “D”
The following defined terms are deleted because they are no longer needed as definitions:
− Affordable Housing Policies and Procedures
− Affordable Housing Inclusionary Fund
− Inclusionary Housing Plan
− Off-Site Inclusionary Unit
− On-Site Inclusionary Unit
− Target Income
− Unit Size
 Section 28.43.030, Inclusionary Requirements
Consolidated into proposed Section 30.160.030, Inclusionary Housing Requirements.  Section 28.43.040, Projects Exempted From Inclusionary Requirements Consolidated into proposed Section 30.160.030, Inclusionary Housing Requirements.  Section 28.43.050, Incentives for On-Site Housing
Consolidated into proposed Section 30.160.030, Inclusionary Housing Requirements.

4 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
 Section 28.43.060, Affordable Housing Standards – Construction Standards for Inclusionary Units
Consolidated into proposed Section 30.160.040, Inclusionary Housing Units.  Section 28.43.070, In-Lieu Fees
Consolidated into proposed Section 30.160.050, Inclusionary Housing In-Lieu Fees and the proposed Fee Schedule amendments.
 Section 28.43.080, Alternative Methods of Compliance
Consolidated into proposed Section 30.160.060, Alternative Compliance.  Section 28.43.090, Inclusionary Housing Plan Processing Consolidated into proposed Section 30.160.070, Affordable Housing Plan, proposed Section 30.160.080, Affordability Control Covenant, and existing Affordable Housing Plan Supplemental Application.
 Section 28.43.100, Eligibility for Inclusionary Units Consolidated into proposed Section 30.160.040, Inclusionary Housing Units.  Section 28.43.110, Owner-Occupied Units; Sales Price; Long-Term Restrictions Consolidated into proposed Section 30.160.040, Inclusionary Housing Units.  Section 28.43.120, Adjustments and Waivers
Consolidated into proposed Section 30.160.060, Alternative Compliance.  Section 28.43.130, Affordable Housing Inclusionary Fund Consolidated into proposed Section 30.160.050, Inclusionary Housing In-Lieu Fees.

Title 30 Zoning—Inland
Amend Section 30.15.050, Fractions
Remove Subsection 30.15.050.C, Exception for Inclusionary Housing.

Title 30 Zoning—Inland
Amend multiple sections in Chapter 30.150, Average Unit-Size Density Incentive Program  Section 30.150.020, Definitions
All definitions were removed from Section 30.150.020 and moved into Chapter 30.300, Definitions. Specific edits are described below. See Exhibit D of the August 20, 2026 Planning Commission Staff Report for proposed definition amendments.

The following terms were revised and reorganized into multiple sections:
− Chapter 30.300.010, “A” under “Affordable Housing Terms”

5 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
o Affordable Housing
o Affordable Rent
o Area Median Income (AMI)
o Moderate Income Household (under Affordable Housing Households) − Section 30.300.080, “H” under “Housing”
o Market-Rate Unit (renamed “Market-Rate Housing”)
o Ownership Housing
o Rental Housing
No changes were made to the following AUD Program definitions besides moving the terms to Chapter 30.300, Definitions:
− Average Unit Size (now in Section 30.300.010, “A”)
− Community Benefit Housing (now in Section 30.300.080, “H” under “Housing”) − Employer-Sponsored Housing (now in Section 30.300.080, “H” under “Housing”) − Limited-Equity Housing Cooperative (now in Section 30.300.120, “L”) − Local Employer (now in Section 30.300.120, “L”)
− Priority Housing (now in Section 30.300.080, “H” under “Housing”) The following terms are already defined in Chapter 30.300, Definitions:
− Household – existing defined term in Section 30.300.080, “H” − Net Floor Area – existing defined term “Floor Area, Net” in Section 30.300.060, “F” The following defined terms are deleted because they are no longer needed as definitions:
− Moderate Income Housing Plan
− Moderate Income Unit
 Section 30.150.080, Inclusionary Housing Requirements Language amended to simplify and direct to the consolidated requirements in the proposed Chapter 30.160, Inclusionary Housing.

6 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
Title 30 Zoning—Inland
Amend Chapter 30.160, Inclusionary Housing
 Section 30.160.010, Purpose
Simplify the purpose statement for the inclusionary housing requirements.  Section 30.160.020, Definitions
All definitions were removed from Section 30.130.020 and moved into Chapter 30.300, Definitions. Specific edits are described below. See Exhibit D of the August 20, 2026 Planning Commission Staff Report for proposed definition amendments.

The following terms are reorganized and revised into multiple sections:
− Section 30.300.010, “A” under “Affordable Housing Terms” o Area Median Income
o Middle Income Household (see Affordable Housing Households) o Upper-Middle Income Household (see Affordable Housing Households) − Section 30.300.080, “H” under “Housing”
o Inclusionary Unit (renamed “Inclusionary Housing”)
− Market-Rate Unit (renamed “Market-Rate Housing”)
o Ownership Unit (renamed “Ownership Housing”)
− Section 30.300.190, “S”
o Residential Lot Subdivision – existing defined term, renamed to “Subdivision” The following terms are already defined in Chapter 30.300, Definitions:
− Household – existing defined term in Section 30.300.080, “H” − Residential Development – existing defined term “Development” in Section 30.300.040, “D”
The following defined terms are deleted because they are no longer needed as definitions:
− Affordable Housing Policies and Procedures
− Affordable Housing Inclusionary Fund
− Inclusionary Housing Plan

7 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
− Off-Site Inclusionary Unit
− On-Site Inclusionary Unit
− Target Income
− Unit Size
 Section 30.160.030, Inclusionary Requirements
Regulations reorganized into proposed Section 30.160.030, Inclusionary Housing Requirements and Section 30.160.040, Inclusionary Housing Units.  Proposed Section 30.160.030, Inclusionary Housing Requirements.

The percentage of inclusionary units required (15% of ownership units for projects proposing two or more units and 10% of rental units for projects proposing five or more units) remains unchanged, as do the households these inclusionary units are intended for (Middle-Income for ownership units and Moderate-Income for rental units).

The proposed amendments change the unit count for purposes of calculating inclusionary housing requirements for projects adding new units to already developed sites. Previously, the ownership requirements and rental requirements did not match—the proposed changes align the unit count method. As proposed, existing units over five years old (as documented with a Certificate of Occupancy) are not counted in the unit quantity used for the inclusionary housing calculation.

The proposed amendments allow the amount of a fractional remainder—0.01 up to 0.99—to be satisfied with payment of an inclusionary housing in-lieu fee for all projects, rather than requiring remainders of 0.50 round up to an additional on-site inclusionary housing unit.

The proposed amendments allow inclusionary units to be provided as “bonus” units (above the maximum residential density allowed on the site). Previously, only ownership projects were allowed this increase in density while rental projects had to count the inclusionary units within the density allowed on site.

The residential projects exempt from inclusionary housing requirements did not change.  Section 30.160.040, Exemptions
Regulations reorganized into proposed Section 30.160.030, Inclusionary Housing Requirements and Section 30.160.040, Inclusionary Housing Units.  Proposed Section 30.160.040, Inclusionary Housing Units The development standards for inclusionary housing units remain relatively unchanged. The requirements for unit distribution, design quality, unit size, and timing of construction have

8 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
been reworded but there is no change to the underlying requirements. The minimum bedroom and bathrooms ratios for inclusionary housing units have been simplified to match ratios with those in market-rate units. A requirement for common amenities is proposed.

Price restrictions and eligible household criteria are simplified in the proposed ordinance, since both topics are regulated in the Affordable Housing Policies and Procedures.  Section 30.160.050, Incentives for On-Site Housing
Regulations reorganized into proposed Section 30.160.030, Inclusionary Housing Requirements.
 Proposed Section 30.160.050, Inclusionary Housing In-Lieu Fees The calculation method for the inclusionary housing in-lieu fee is proposed as consistent for both rental projects and ownership projects. Previously, the ownership calculation method was incredibly detailed and difficult to implement, while the rental calculation method was straightforward for both applicants and staff. The changes maintain the rental calculation method and apply it to ownership calculations as well. The Floor area used in the fee calculation has also been clarified.

All inclusionary housing fee payments will now be collected in the Local Housing Trust Fund (LHTF) rather than collected in the Affordable Housing Inclusionary Fund and moved to the LHTF. This implements supporting comments made by Planning Commission and during the City Council hearing.

The inclusionary housing in-lieu fee rates are being moved out of the ordinance and into the Fee Schedule. This ensures that the fee will be adjusted annually to account for inflation.

The allowance for delayed payment of the inclusionary housing in-lieu fee has been made consistent for both ownership and rental projects. The change allows projects to request delayed payment with a predictable outcome for applicants electing to pay after Building Permit issuance rather than before.
 Section 30.160.060, Affordable Housing Standards
Regulations reorganized into proposed Section 30.160.040, Inclusionary Housing Units and the existing Affordable Housing Policies and Procedures.
 Proposed Section 30.160.060, Alternative Compliance.

The proposed amendments expand upon and refine existing alternative compliance methods an applicant may propose to satisfy the inclusionary housing requirements.

A project may construct inclusionary housing units off-site rather than on-site. An applicant must construct the same quantity of off-site units as would be required on-site and all the

9 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
development standards, price restrictions, and eligible households for on-site units apply to off-site units. The location of the off-site units is regulated. The main developmentʼs building permit cannot be issued without the off-site unit building permit being issued and the off-site units must receive final occupancy prior to occupancy of the main development.

A project may acquire and rehabilitate existing units rather than construct on-site inclusionary housing units. An applicant must acquire and rehabilitate more units than the quantity required on-site (150% increase). Similar to off-site inclusionary housing units, acquired and rehabilitated units have location requirements and must meet the development standards, price restrictions, and eligible household criteria as the on-site units. Permit issuance for the main development and the acquired and rehabilitated units is tied together.

A newly proposed alternative compliance method is an inclusionary housing offset fee. This is Option G.2. Consider In-Lieu Fee Payment for All Inclusionary Requirements, in the Study, and was rebranded to reduce confusion between the offset fee, which fully satisfies the inclusionary housing requirements, and the in-lieu fee, which satisfies fractional inclusionary housing requirements (including requirements for projects of less than 10 units). The different names also keep the fee rates, which differ for in-lieu versus offset fee payments, clearly defined in the Fee Schedule.

An applicant may propose a combination of the alternative compliance methods to satisfy a projectʼs inclusionary housing requirements.
 Section 30.160.070, In-Lieu Fees
Regulations reorganized into proposed Section 30.160.050, In-Lieu Fees and the proposed Fee Schedule.
 Proposed Section 30.160.070, Affordable Housing Plan
The requirement for an Affordable Housing Plan remains relatively unchanged. However, timing of submittal has been changed: the Plan is now required as part of the planning permit application (rather than with the building permit application) and must be approved in conjunction with all other municipal code requirements for permit issuance. Details of the Plan are specified in the Affordable Housing Plan Supplemental Application.  Section 30.160.080, Alternative Methods of Compliance Regulations reorganized into proposed Section 30.160.060, Alternative Compliance.  Proposed Section 30.160.080, Affordability Control Covenant The proposed amendments for affordability control covenants require recordation of the covenant prior to building permit issuance, in accordance with the Affordable Housing Policies and Procedures.

10 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
 Section 30.160.090, Inclusionary Housing Plan Processing Regulations reorganized into proposed Section 30.160.070, Affordable Housing Plan, proposed Section 30.160.080, Affordability Control Covenant, and the existing Affordable Housing Plan Supplemental Application.
 Section 30.160.100, Eligibility for Inclusionary Units Regulations reorganized into proposed Section 30.160.040, Inclusionary Housing Units and the existing Affordable Housing Policies and Procedures.
 Section 30.160.110, Owner-Occupied Units; Sales Price; Long-Term Restrictions Regulations reorganized into proposed Section 30.160.040, Inclusionary Housing Units and the existing Affordable Housing Policies and Procedures.
 Section 30.160.120, Adjustments and Waivers
Regulations reorganized into proposed Section 30.160.060, Alternative Compliance.  Section 30.160.130, Affordable Housing Inclusionary Fund Regulations reorganized into proposed Section 30.160.050, Inclusionary Housing In-Lieu Fees and the existing Chapter 26.80, Local Housing Trust Fund.

Title 30 Zoning—Inland
Amend Section 30.185.045, Adaptive Reuse Projects
Update municipal code references in Subsection 30.185.045.J.3, Inclusionary Housing.

Title 30 Zoning—Inland
Amend multiple sections in Chapter 30.300, Definitions
See Exhibit D of the August 20, 2026 Planning Commission Staff Report for proposed definition amendments.
 Section 30.300.010, “A”
Relocated and consolidated the following for Affordable Housing Terms from Section 28.43.020, Definitions, Section 30.150.020, Definitions, and Section 30.160.020, Definitions:
− Affordable Housing
− Affordable Housing Households
o Moderate-Income Household
o Middle-Income Household
o Upper-Middle-Income Household

11 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
− Affordable Rent
− Area Median Income (AMI)
Added new definitions for Affordable Housing Terms:
− 100% Affordable Housing Project
− Affordable Housing Households
o Acutely-Low-Income Household
o Extremely-Low-Income Household
o Very-Low-Income Household
o Low-Income Household
o Lower-Income Household
Relocated with no change to the defined term “Average Unit Size” from Section 30.150.020, Definitions of the AUD Program chapter.
 Section 30.300.080, “H”
Relocated and revised the following under “Housing” from Section 28.43.020, Definitions, Section 30.150.020, Definitions, and Section 30.160.020, Definitions:
− Affordable Housing (included here, directs to Affordable Housing Terms) − Inclusionary Housing
− Market-Rate Housing
− Ownership Housing
− Rental Housing
Relocated with no change to following defined terms from Section 30.150.020, Definitions of the AUD Program chapter to “Housing:”
− Community Benefit Housing
− Employer-Sponsored Housing
− Priority Housing

12 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
 Section 30.300.120, “L”
Relocated with no change to the following defined terms from Section 30.150.020, Definitions of the AUD Program chapter:
− Limited-Equity Housing Cooperative
− Local Employer
 Section 30.300.180, “R”
Removed term “Residential Lot Subdivision” and replaced with “Subdivision” in Section 30.300.190, “S.”
 Section 30.300.190, “S”
Added definitions for:
− Subdivision
− Subdivision, Condominium
− Subdivision, Lot-Only
− Subdivision, Lot with Development
Title 30 Zoning—Inland
Delete multiple sections in Chapter 30.150, Average Unit-Size Density Incentive Program  Section 30.150.110, Inclusionary Requirements for Rental Housing Projects Regulations reorganized into proposed Section 30.160.030, Inclusionary Housing Requirements.
 Section 30.150.120, Inclusionary Housing In-Lieu Fees Regulations reorganized into proposed Section 30.160.050, Inclusionary Housing In-Lieu Fees and the proposed Fee Schedule.
 Section 30.150.130, Moderate Income Housing Standards Regulations reorganized into proposed Section 30.160.040, Inclusionary Housing Units.  Section 30.150.140, Moderate Income Housing Plan Processing Regulations reorganized into proposed Section 30.160.070, Affordable Housing Plan, Section 30.160.080, Affordability Control Covenant, and the existing Affordable Housing Plan Supplemental Application.
 Section 30.150.150, Processing Waivers, Adjustments, and Reductions Regulations reorganized into proposed Section 30.160.060, Alternative Compliance.

Inclusionary Housing Ordinance Amendments Attachment 3
Explanation of Revisions 13
Fee Schedule
The Fee Schedule is reviewed, updated, and adopted each year through the Cityʼs annual budget process, and any mid-cycle changes require a City Council Resolution. The resolution and proposed Fee Schedule amendments will be provided at the Introduction hearing at City Council. No action is requested on the Fee Schedule amendments as part of this agenda item; this content is purely informational.

Community Development Department: Planning, and Building and Safety Fees Fee rates for inclusionary housing in-lieu fees and offset fees added to Section 1. Planning Division fees of the City Fee Schedule for Fiscal Year 2026–2027.

Item Proposed Fee Rate
In-Lieu Fee for Fractional Units on Projects of Nine or Fewer Units $35.00 per sq. ft.

In-Lieu Fee for Fractional Units on Projects of Ten or More Units $50.00 per sq. ft.

In-Lieu Fee for Lot-Only Subdivisions $760,250 per lot1 Offset Fee for Rental Projects $91.00 per sq. ft.
[Planning Commission Recommendation] Offset Fee for Rental Projects in the Central Business District*
$73.00 per sq. ft.*
Offset Fee for Ownership Projects $72.00 per sq. ft. 1 The proposed fee rate for Lot-Only Subdivisions is pro-rated based on number of lots being created: 5% for projects creating fewer than 10 lots, 15% for projects creating 10 or more lots.* * The Planning Commission recommended Offset Fee for Rental Projects in the Central Business District may or may not be included in the Fee Schedule amendments proposed to City Council depending on guidance provided by the Ordinance Committee.

Affordable Housing Policies and Procedures
The Affordable Housing Policies and Procedures is a manual that sets forth the Cityʼs affordable housing policies and procedures, including detailed descriptions of affordability requirements and formulas. It was adopted by City Council Resolution No. 21-017 and requires a City Council Resolution to amend. The resolution and proposed AffordableHousing Policies and Procedures amendments will be included in the Introduction hearing at City Council. No action is requested on the Affordable Housing Policies and Procedures amendments as part of this agenda item; this content is purely informational.

III. The City's Policies for Affordability
Amend Table 2. Affordable Housing Programs in the City to update the Target Income Percentage for City Inclusionary Program for Rental Projects.

Appendix H. Inclusionary Housing Example Calculations
Add an appendix with the example inclusionary housing calculations.

14 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
 In-Lieu Fee Amount
Fractional Requirement
Ordinance: Section 30.160.050, Inclusionary Housing In-Lieu Fees Fractional Inclusionary Housing Requirement / Total Inclusionary Housing Requirement x Inclusionary Housing In-Lieu Fee Rate x Livable Floor Area of the entire project − “Large” Rental Project Example
Example: 43-unit rental housing project totaling 34,873 sq. ft. (livable floor area of the entire project) has an inclusionary housing requirement of 10%, or 4.3. An applicant must provide four inclusionary units and pay an in-lieu fee for the remaining 0.3 fractional requirement (4.3 – 4 on-site units = 0.3). This example uses $50.00 per sq. ft. as the inclusionary housing in-lieu fee rate. The inclusionary housing in-lieu fee amount is calculated as follows:
o Fractional Inclusionary Housing Requirement 0.3
o Total Inclusionary Housing Requirement 4.3
o Inclusionary Housing In-Lieu Fee Rate $50.00 per sq. ft. o Livable Floor Area of the entire project 34,873 sq. ft

0.3 / 4.3 x $50.00 per sq. ft x 34,873 sq. ft. = $121,650 − “Large” Ownership Project Example
Example: 13-unit ownership housing project totaling 14,550 sq. ft. (livable floor area of the entire project) has an inclusionary housing requirement of 15%, or 1.95. An applicant must provide one inclusionary unit and pay an in-lieu fee for the remaining

0.95 fractional requirement (1.95 – 1 on-site unit = 0.95). This example uses $50.00 per sq. ft. as the inclusionary housing in-lieu fee rate. The inclusionary housing in-lieu fee amount is calculated as follows:
o Fractional Inclusionary Housing Requirement 0.95
o Total Inclusionary Housing Requirement 1.95
o Inclusionary Housing In-Lieu Fee Rate $50.00 per sq. ft. o Livable Floor Area of the entire project 14,550 sq. ft.

0.95 / 1.95 x $50.00 per sq. ft x 14,550 sq. ft. = $354,423

15 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
− “Small” Rental Project Example
Example: 5-unit rental housing project totaling 4,525 sq. ft. (livable floor area of the entire project) has an inclusionary housing requirement of 10%, or 0.5. An applicant may provide one inclusionary unit or pay an in-lieu fee for the 0.5 fractional requirement. This example uses $35.00 per sq. ft. as the inclusionary housing in-lieu fee rate. The inclusionary housing in-lieu fee amount is calculated as follows:
o Fractional Inclusionary Housing Requirement 0.5
o Total Inclusionary Housing Requirement 0.5
o Inclusionary Housing In-Lieu Fee Rate $35.00 per sq. ft. o Livable Floor Area of the entire project 4,525 sq. ft.

0.5 / 0.5 x $35.00 per sq. ft x 4,525 sq. ft. = $113,125 Lot-Only Subdivision
Ordinance: Section 30.160.050, Inclusionary Housing In-Lieu Fees Prorated Inclusionary Housing In-Lieu Fee Rate x Total Lots resulting from subdivision Example: 3 lot-only subdivision ownership project is required to pay the inclusionary housing in-lieu fee, calculated as follows:
o Proration 5%
o Inclusionary Housing In-Lieu Fee Rate $760,250 per lot o Total Lots 3
(5% x $760,250) x 3 = $114,037.50
Delayed In-Lieu Fee Payment
Ordinance: Section 30.160.050, Inclusionary Housing In-Lieu Fees 10% increase: The number of years, or portions thereof, between building permit issuance and fee payment multiplied by 10%. This means, at minimum, a 10% increase if the in-lieu fee is not paid prior to BLD issuance.

Inclusionary housing in-lieu fee rate at time of payment: Recalculate the in-lieu fee amount with the fee rates in effect at time of payment.

Inclusionary Housing Ordinance Amendments Attachment 3
Explanation of Revisions 16
Example: An applicant delays payment of the inclusionary housing in-lieu fee. The inclusionary housing in-lieu fee rate is $50.00 per sq. ft. at building permit issuance, calculating to a fractional in-lieu fee amount of $121,650 (0.3 / 4.3 x $50.00 per sq. ft. x 34,873 sq. ft.). Certificate of Occupancy is issued three years after the building permit was issued, therefore the delayed payment of the inclusionary housing in-lieu fee amount is now $158,145 since this is the greater of the two delayed payment calculation methods.
10% increase: The delayed payment increase of 10% each year results in a 30% increase for the three-year delay. The delayed inclusionary housing in-lieu fee amounts equals $158,145 ($121,650 x 130%).

Inclusionary housing in-lieu fee rate at time of payment: The in-lieu fee rate in effect at time of payment is $58.14 per sq. ft. which calculates to an in-lieu fee amount of $141,455.75 (0.3 / 4.3 x $58.14 per sq. ft. x 34,873 sq. ft.).  Offset Fee Amount
Ordinance: Section 30.160.060, Alternative Compliance
Un-built Inclusionary Housing Requirement / Total Inclusionary Housing Requirement x Inclusionary Housing Offset Fee Rate x Livable Floor Area − Rental Project Example
Example: 43-unit rental housing project totaling 34,873 sq. ft. (livable floor area of the entire project) has an inclusionary housing requirement of 10%, or 4.3. An applicant elects to provide zero on-site inclusionary units and instead pay the inclusionary housing offset fee for the entire inclusionary housing requirement of 4.3 (example uses $91.00 per sq. ft.). The inclusionary housing offset fee is calculated as follows:
o Un-built Inclusionary Housing Requirement 4.3
o Total Inclusionary Housing Requirement 4.3
o Inclusionary Housing Offset Fee Rate $91.00 per sq. ft. o Livable Floor Area of the project 34,873 sq. ft

4.3 / 4.3 x $91.00 per sq. ft x 34,873 sq. ft. = $3,173,443 If, instead, the applicant elects to provide two on-site inclusionary units and the remaining inclusionary housing requirement of 2.3 is un-built and satisfied by the

17 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
inclusionary housing offset fee (example uses $91.00 per sq. ft.), the payment is calculated as follows:
o Un-built Inclusionary Housing Requirement 2.3
o Total Inclusionary Housing Requirement 4.3
o Inclusionary Housing Offset Fee Rate $91.00 per sq. ft. o Livable Floor Area of the project 34,873 sq. ft

2.3 / 4.3 x $91.00 per sq. ft x 34,873 sq. ft. = $1,697,423 − Ownership Project Example
Example: 13-unit ownership housing project totaling 14,550 sq. ft. (livable floor area of the entire building) has an inclusionary housing requirement of 15%, or 1.95. An applicant elects to provide zero on-site inclusionary units and instead pay the offset fee for the entire inclusionary housing requirement of 1.95 (example uses $72.00 per sq. ft.).

The payment of the inclusionary housing offset fee is calculated as follows:
o Un-built Inclusionary Housing Requirement 1.95
o Total Inclusionary Housing Requirement 1.95
o Inclusionary Housing Offset Fee Rate $72.00 per sq. ft. o Livable Floor Area of the project 14,550 sq. ft

1.95 / 1.95 x $72.00 per sq. ft x 14,550 sq. ft. = $1,047,600  Floor Area in Fee Calculations
Example: A mixed-use project proposes 43 rental units totaling 34,873 sq. ft. (livable floor area of the entire project) and 1,869 sq. ft. of commercial space. Overall, the entire project is 42,896 gross sq. ft, excluding parking. For the purpose of the inclusionary housing fee calculations, the livable floor area of the entire project is used. Commercial space, parking, and non-livable area are not included.
o Livable Floor Area of the entire project 34,873 sq. ft. o Residential Circulation 8,023 sq. ft.
o Commercial Space 1,869 sq. ft.
o Gross Building Area without parking 42,896 sq. ft.

18 Inclusionary Housing Ordinance Amendments Attachment 3 Explanation of Revisions
Gross Building Area = Livable Floor Area of the entire project + Residential Circulation + Commercial Space
42,896 sq. ft. = 34,873 sq. ft. + 8,023 sq. ft. + 1,869 sq. ft.

For projects using the Average Unit Size Density Incentive Program, the Livable Floor Area of the entire project divided by the number of units is the Average Unit Size. 34,873 sq. ft / 43 units = 811 sq. ft. average unit size  Acquired and Rehabilitated Unit Minimum Calculation
Ordinance: Section 30.160.060, Alternative Compliance
− Rental Project Example
Example: 43-unit rental project has an inclusionary housing requirement of 10%, calculating to 4 on-site inclusionary units and a remaining 0.3 fractional requirement satisfied with an inclusionary housing in-lieu fee payment. An applicant elects to acquire and rehabilitate units for the entire inclusionary housing requirement. The inclusionary housing requirement for acquired and rehabilitated units is 150% of the on-site inclusionary units, calculating to 6 acquired and rehabilitated units. 4 on-site units x 150% = 6 acquired and rehabilitated units − Ownership Project Example
Example: 13-unit ownership housing project has an inclusionary housing requirement of 15%, calculating to 1 on-site inclusionary unit and a remaining 0.95 fractional requirement satisfied with an inclusionary housing in-lieu fee payment. An applicant elects to acquire and rehabilitate units for the entire inclusionary housing requirement.

The inclusionary housing requirement for acquired and rehabilitated units is 150% of the on-site inclusionary units, calculating to 2 acquired and rehabilitated units. 1 on-site unit x 150% = 1.5 rounds up to 2 acquired and rehabilitated units.

1 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Attachment 4. Financial Feasibility Analyses of Council-Supported Recommendations
BAE Urban Economics, the consultant for the Inclusionary Housing and In-Lieu Fee Study, conducted additional analyses of Option G.1 and Option G.2 to respond to City Councilʼs direction for additional research at the May 5, 2026 City Council hearing. The analysis, based on the same logic and assumptions as the Study, evaluates the impacts of all recommendations supported by City Council and the associated financial feasibility of two prototypes from the Study for each permutation of fee payment options:
• Existing Program (Baseline)
• Option G.1 Consider In-Lieu Fee Payment for All Fractional Inclusionary Requirements (All Fractional In-Lieu Fee)
• Option G.2 Consider In-Lieu Fee Payment for All Inclusionary Requirements (Offset Fee)
Prototype V: Rental Mixed-Use Large Prototype
Prototype V is a rental development of 43 units and 34,873 net residential square feet. It has a

4.3 inclusionary housing requirement (10% for Moderate-Income households).

Table 1. Financial Feasibility Outcomes of Council-supported Recommendations, Prototype V
Existing Program
(Baseline)
Option G.1
(All Fractional)
Option G.2
(Offset Fee)
Total Project Units 43 47 43
Recommendations N/A B, C, F, G.1, J B, G.2, J
Inclusionary Units 4 4 0
Inclusionary Fee $60,825 @ $25/sf $121,650 @ $50/sf $3,173,741 @ $91/sf RLV per site sq. ft. $82 $115 -$34
Financial Feasibility Not Likely Feasible Not Likely Feasible Not Likely Feasible Existing Program (Baseline)
Prototype V requires four on-site inclusionary housing units and a fractional in-lieu fee payment of $60,825 (remaining fractional requirement of 0.3 and a fee rate of $25.00 per sq. ft.). The financial feasibility of Prototype V under the Existing Program is “not likely feasible” because the RLV of $82 per site sq. ft. is less than the land costs ($150 per site sq. ft.).

Inclusionary Housing Ordinance Amendments Attachment 4
Financial Feasibility Analyses 2
Option G.1 (All Fractional In-Lieu Fee)
Prototype V requires four on-site inclusionary housing units and a fractional in-lieu fee payment of $120,650 (remaining fractional requirement of 0.3 and a fee rate of $50.00 per sq. ft.). The financial feasibility of Prototype V under Option G.1 and the recommendations supported by City Council remains “not likely feasible” because the RLV of $115 per site sq. ft., while higher than the Existing Program, is lower than land costs ($150 per site sq. ft.).

Option G.2 (Offset Fee)
Prototype V may elect to build zero on-site units and pay an offset fee of $3,187,741 (inclusionary housing requirement of 4.3 and a fee rate of $91.41 per sq. ft.). The financial feasibility of Prototype V under Option G.2 and the recommendations supported by City Council remains “not likely feasible” because the RLV of -$34 per site sq. ft. is lower than land costs ($150 per site sq. ft.).

Prototype II: Ownership Prototype
Prototype II is an ownership development of 15 units and 14,550 net residential square feet. It has a 1.95 inclusionary housing requirement (13 base density units x 15% for Middle-Income households).

Table 2. Financial Feasibility Outcomes of Council-supported Recommendations, Prototype II
Existing Program
(Baseline)
Option G.1
(All Fractional)
Option G.2
(Offset Fee)
Total Project Units 15 14 13
Recommendations N/A B, D, G.1, H B, G.2, H
Inclusionary Units 2 1 0
Inclusionary Fee $0 $330,795 @ $50/sf $914,603 @ $72/sf RLV per site sq. ft. $57 $57 $38
Financial Feasibility Not Likely Feasible Not Likely Feasible Not Likely Feasible Existing Program (Baseline)
Prototype II requires two on-site inclusionary housing units. The financial feasibility of Prototype II under the Existing Program is “not likely feasible” because the RLV of $57 per site sq. ft. is less than the land costs ($125 per site sq. ft.).

Option G.1 (All Fractional In-Lieu Fee)
Prototype II requires one on-site inclusionary housing units and a fractional in-lieu fee payment of $330,795 (remaining fractional requirement of 0.95 and a fee rate of $50.00 per sq. ft.). The financial feasibility of Prototype II under Option G.1 and the recommendations supported by

3 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
City Council remains “not likely feasible” because the RLV of $57 per site sq. ft. is lower than land costs ($125 per site sq. ft.).

Option G.2 (Offset Fee)
Prototype II may elect to build zero on-site units and pay an offset fee of $914,603 (inclusionary housing requirement of 1.95 and a fee rate of $72.53 per sq. ft.). The financial feasibility of Prototype II under Option G.2 and the recommendations supported by City Council remains “not likely feasible” because the RLV of $38 per site sq. ft. is lower than land costs ($125 per site sq. ft.).

4 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Table 3. Existing Program (Baseline), Prototype V
Development Program Assumptions Cost and Income Assumptions Development Cost Analysis Site Size (acres) 0.69 Development Costs Hard Costs
Site Size (sf) 30,000 Residential Hard Costs, per sf $443 (b) Residential $18,186,500 Commercial Hard Costs, per sf $443 (c) Commercial $828,373 Total Dwelling Units 43 Podium Parking, per space $40,000 Podium Parking $1,800,000 Commercial Space (sf, gross) 1,869 Underground Parking, per space $70,000 Underground Parking $0 Gross Residential Area (sf) 41,027 Total Hard Costs $20,814,873 GBA (excluding parking, sf) 42,896 Hard Costs per Unit $484,067 Residential Circulation eff (%) 85% Soft Costs (as a % of hard costs) 15% (d) Net Residential (sf) 34,873 School Fees (per sf residential) $3.79 (e) Soft Costs $3,122,231 Average Unit Size (net, sf) 811 School Fees (per sf commercial) $0.78 (e) School Fees $156,950 Fractional Fee $60,825 (h)
Total Parking Spaces 45 Total Soft Costs $3,340,006
Surface Spaces 0 Market-Rate Rental Prices (f)
Podium Spaces 45 Market Rate Studio, per Month $3,303 Developer Profit $2,415,488 Underground Spaces 0 Market Rate 1 BR, per Month $3,686 Parking Ratio (spaces/du) 1.05 Market Rate 2 BR, per Month $4,455 Total Development Costs (Excl. Land) $26,570,367 Garage Size (sf) 19,096 Market Rate 3 BR, per Month $4,883 Cost per non parking sf $619 Cost per residential unit $617,916
Unit Mix % # Moderate-Income Rental Prices (net utilities) (g) Studio 0% 0.0 Moderate Income Studio, per Month $1,604 Valuation Analysis One-Bedroom 25% 11.0 Moderate Income 1 BR, per Month $1,990 Projected Revenue Two-Bedrooms 75% 32.0 Moderate Income 2 BR, per Month $2,372 Gross Annual Income $2,174,890 Three-Bedrooms 0% 0.0 Moderate Income 3 BR, per Month $2,641 Less: Vacancy ($108,744) Total 0% 43.0 Commercial Revenue ($/sf) $3.26 Less: Operating Expenses ($652,467) Net Operating Income (NOI) $1,413,678
Affordable Units 10% 4.30 (a) Vacancy Assumption 5%
Capitalized Project Value $29,028,303
Affordable Breakdown Aff Market Operating Expenses (% gross revenues) 30% Less Total Development Costs ($26,570,367) Studio 0.0 0.0 Residual Land Value (RLV) $2,457,937
One-Bedroom 1.0 10.0 Developer Profit (as % of total project costs) 10% Two-Bedrooms 3.0 29.0 RLV per Site sf $82
Three-Bedrooms 0.0 0.0 Capitalization Rate 4.87% Feasibility Threshold per Site sf $150 Total 4.0 39.0 Financially Feasible? No
Notes:
(a) Per Santa Barbara Municipal Code 30.150.110 - Inclusionary Requirements for Rental Housing Projects. (b) Hard Costs include Site Prep work (e.g., grading, minor demolition), and assume Tier 4 Stormwater Requirements (additional $17/sf GBA for a $700,000 investment). (c) Includes Commercial Shell and Tenant Improvements
(d) Soft costs shown in this line include engineering, architecture, as well as City cost-recovery fees for planning, permitting, and entitlements, and financing. (e) Per Santa Barbara Unified Developer Fee Schedule, effective October 2024. (f) Based on rents for market-rate units in recently-constructed multifamily rental developments, according to CoStar. Rental rate shown is weighted based on unit mix of prototype. (g) Per Maximum Rent levels for Target AMI of 100%, net Utilities. (h) In-Lieu Fee Payment = Fractional Remainder ÷ Total Inclusionary Requirement x $25.00 x Net Floor Area.

Source: BAE, 2025.

5 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Table 4. Option G.1 (All Fractional), Prototype V
Development Program Assumptions Cost and Income Assumptions Development Cost Analysis Site Size (acres) 0.69 Development Costs Hard Costs
Site Size (sf) 30,000 Residential Hard Costs, per sf $443 Residential $18,186,500 Commercial Hard Costs, per sf $443 (c) Commercial $828,373 BASE Dwelling Units 43 Podium Parking, per space $40,000 Podium Parking $1,800,000 Commercial Space (sf, gross) 1,869 Underground Parking, per space $70,000 Underground Parking $0 Gross Residential Area (sf) 41,027 Parking Stackers $0
GBA (excluding parking, sf) 42,896 Total Hard Costs $20,814,873 Residential Circulation eff (%) 85% Soft Costs (as a % of hard costs) 15% (d) Hard Costs per Unit $484,067 Net Residential (sf) 34,873 Impact Fees (per sf residential) $3.79 (e) Average Unit Size (net, sf) 742 Impact Fees (per sf commercial) $0.78 (e) Soft Costs $3,122,231 School Fees $156,950
Total Parking Spaces 45 Fractional Fee $121,650 (h)
Surface Spaces 0 Market-Rate Rental Prices Total Soft Costs $3,400,831 Podium Spaces 45 Market Rate Studio, per Month $3,303 (f) Underground Spaces 0 Market Rate 1 BR, per Month $3,912 Developer Profit $2,421,570 Parking Ratio (spaces per dwelling unit) 0.96 Market Rate 2 BR, per Month $4,120 Garage Size (sf) 19,096 Market Rate 3 BR, per Month $4,883 Total Development Costs (Excl. Land) $26,637,274 Cost per non parking sf $621
Affordable Units 10% 4.30 (a) Target AMI 110% Cost per residential unit $619,471 Bonus Units 4 (b) Moderate Income Studio, per Month $1,772 (g) Total Dwelling Units 47 Moderate Income 1 BR, per Month $2,203 Valuation Analysis Moderate Income 2 BR, per Month $2,629 Projected Revenue Unit Mix % # Moderate Income 3 BR, per Month $2,875 Gross Annual Income $2,253,326 Studio 9% 4.0 Commercial Revenue ($/sf) $3.26 Less: Vacancy ($112,666) One-Bedroom 23% 11.0 Less: Operating Expenses ($675,998) Two-Bedrooms 68% 32.0 Vacancy Assumption 5% Net Operating Income (NOI) $1,464,662 Three-Bedrooms 0% 0.0
Total 100% 47.0 Operating Expenses (% gross revenues) 30% Capitalized Project Value $30,075,193 Less Total Development Costs ($26,637,274)
Affordable Breakdown Aff Market Developer Profit (as % of total project costs) 10% Residual Land Value (RLV) $3,437,919 Studio 0.0 4.0
One-Bedroom 2.0 9.0 Capitalization Rate 4.87% RLV/acre $4,991,858 Two-Bedrooms 2.0 30.0
Three-Bedrooms 0.0 0.0 RLV per Site sf $115
Total 4.0 43.0
Notes:

Highlights show differences from Baseline pro-forma.
(a) Recommendation B: Per Santa Barbara Municipal Code 30.150.110 - Inclusionary Requirements for Rental Housing Projects. (b) Recommendation F: Inclusionary units counted as bonus density units. (c) Residential Hard Costs include Site Prep work (e.g., grading, minor demolition), and assuming Tier 4 Stormwater Requirements. (c) Commercial Hard Costs include Commercial Shell and Tenant Improvements (d) Soft costs shown in this line include engineering, architecture, as well as City cost-recovery fees for planning, permitting, and entitlements, and financing. (e) Per Santa Barbara Unified Developer Fee Schedule, effective October 2024. (f) Based on asking rents per square foot for market-rate units in recently-constructed multifamily rental developments, according to CoStar. Rental rate shown weighted based on unit mix of prototype. Assumes an average unit size of 490 sf for studios, 690 sf for 1-bedrooms, and 800 sf for 2-bedrooms. (g) Recommendation J: Per Maximum Rent levels for Target AMI of 110%, net Utilities.

6 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
(h) Recommendation C and Option G.1: In-Lieu Fee Payment = Fractional Remainder ÷ Total Inclusionary Requirement x $50.00 x Net Floor Area.

Source: BAE, 2026.

Inclusionary Housing Ordinance Amendments Attachment 4
Financial Feasibility Analyses 7
Table 5. Option G.2 (“Fee Out”), Prototype V
Development Program Assumptions Cost and Income Assumptions Development Cost Analysis Site Size (acres) 0.69 Development Costs Hard Costs
Site Size (sf) 30,000 Residential Hard Costs, per sf $443 Residential $18,186,500 Commercial Hard Costs, per sf $443 (b) Commercial $828,373 BASE Dwelling Units 43 Podium Parking, per space $40,000 Podium Parking $1,800,000 Commercial Space (sf, gross) 1,869 Underground Parking, per space $70,000 Underground Parking $0 Gross Residential Area (sf) 41,027 Parking Stackers $0
GBA (excluding parking, sf) 42,896 Total Hard Costs $20,814,873 Residential Circulation eff (%) 85% Soft Costs (as a % of hard costs) 15% (c) Hard Costs per Unit $484,067 Net Residential (sf) 34,873 Impact Fees (per sf residential) $3.79 (d) Average Unit Size (net, sf) 811 Impact Fees (per sf commercial) $0.78 (d) Soft Costs $3,122,231 School Fees $156,950
Total Parking Spaces 45 In-Lieu Fee $3,187,741 (g)
Surface Spaces 0 Market-Rate Rental Prices Total Soft Costs $6,466,922 Podium Spaces 45 Market Rate Studio, per Month $3,303 (e) Underground Spaces 0 Market Rate 1 BR, per Month $3,912 Developer Profit $2,728,179 Parking Ratio (spaces per dwelling unit) 1.05 Market Rate 2 BR, per Month $4,120 Garage Size (sf) 19,096 Market Rate 3 BR, per Month $4,883 Total Development Costs (Excl. Land) $30,009,974 Cost per non parking sf $700
Affordable Units (Fee Out) 0% 0.00 Target AMI 110% (f) Cost per residential unit $697,906 Total Dwelling Units 43 Moderate Income Studio, per Month $1,772 Moderate Income 1 BR, per Month $2,203 Valuation Analysis Unit Mix % # Moderate Income 2 BR, per Month $2,629 Projected Revenue Studio 0% 0.0 Moderate Income 3 BR, per Month $2,875 Gross Annual Income $2,171,608 One-Bedroom 26% 11.0 Commercial Revenue ($/sf) $3.26 Less: Vacancy ($108,580) Two-Bedrooms 74% 32.0 Less: Operating Expenses ($651,483) Three-Bedrooms 0% 0.0 Vacancy Assumption 5% Net Operating Income (NOI) $1,411,545 Total 100% 43.0
Operating Expenses (% gross revenues) 30% Capitalized Project Value $28,984,506 Affordable Breakdown Aff Market Less Total Development Costs ($30,009,974) Studio 0.0 0.0 Developer Profit (as % of total project costs) 10% Residual Land Value (RLV) ($1,025,468) One-Bedroom 0.0 11.0
Two-Bedrooms 0.0 32.0 Capitalization Rate 4.87% RLV/acre ($1,488,979) Three-Bedrooms 0.0 0.0
Total 0.0 43.0 RLV per Site sf ($34)
Notes:

Highlights show differences from Baseline pro-forma.
(a) Recommendation B: Per Santa Barbara Municipal Code 30.150.110 - Inclusionary Requirements for Rental Housing Projects. (b) Residential Hard Costs include Site Prep work (e.g., grading, minor demolition), and assuming Tier 4 Stormwater Requirements. (b) Commercial Hard Costs include Commercial Shell and Tenant Improvements (c) Soft costs shown in this line include engineering, architecture, as well as City cost-recovery fees for planning, permitting, and entitlements, and financing. (d) Per Santa Barbara Unified Developer Fee Schedule, effective October 2024. (e) Based on asking rents per square foot for market-rate units in recently-constructed multifamily rental developments, according to CoStar. Rental rate shown weighted based on unit mix of prototype. Assumes an average unit size of 690 sf for 1-bedrooms and 800 sf for 2-bedrooms. (f) Recommendation J: Per Maximum Rent levels for Target AMI of 110%, net Utilities. (g) Option G.2: In-Lieu Fee Payment = Fractional Remainder ÷ Total Inclusionary Requirement x $91.41 x Net Floor Area. 8 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Source: BAE, 2026.

9 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Table 6. Existing Program (Baseline), Prototype II
Development Program Assumptions Cost and Income Assumptions Development Cost Analysis Site Size (acres) 0.34 Development Costs Hard Costs
Site Size (sf) 15,000 Construction Hard Costs Residential $9,093,750 Residential, per sf $500.00 (c) Podium Parking $960,000 Total "Base" Units 13 Podium Parking, per space $40,000 Total Dwelling Units 15 (a) Total Hard Costs $10,053,750 Avg. Unit Size (net, sf) 970 Hard Costs per Unit $670,250 Soft Costs (as a % of hard costs) 15% (d) Hard Costs per Gross Building sf $553 Gross Building Area (sf) 18,188
Net (% of gross res. area) 80% School Fee (per sf residential) $3.79 (e) Soft costs $1,508,063 Net (sf) 14,550 School Fee $68,931
Market Rate Sales Prices (f) In-Lieu Fee n/a
Total Parking Spaces 24 Market-Rate 1 BR n/a
Podium Spaces 24 Market-Rate 2 BR $1,083,402 Total Soft Costs $1,576,993 Market Rate 3 BR n/a
Parking Ratio (spaces per dwelling unit) 1.60 Developer Profit $1,744,611 Middle Income Sales Prices (g)
Unit Mix % # Middle Income 1 BR $355,700 Total Development Costs (Excl. Land) $13,375,355 One-Bedroom 0% 0 Midldle Income 2 BR $444,600 Cost per residential sf $735 Two-Bedrooms 100% 15 Middle Income 3 BR $503,800 Cost per residential unit $891,690 Three-Bedrooms 0% 0
Marketing and Sales Costs 5% Valuation Analysis
Affordability Share (% of Sale Price) Projected Revenue Middle/Upper Middle 15% 1.95 (b) Gross Sales from Market Rate Units $14,084,226 Middle/Upper Middle (adjusted) 2.0 (b) Developer Profit 15% Sales from Middle-Income 1 BRs $0 (as % of total hard and soft costs) Sales from Middle-Income 2 BRs $889,200 Affordable Breakdown Aff Market Sales from Middle-Income 3 BRs $0 One-Bedroom 0.0 0.0 Total Gross Revenue $14,973,426
Two-Bedrooms 2.0 13.0
Three-Bedrooms 0.0 0.0 Less Marketing Costs ($748,671)
Total 2.0 13.0 Less Total Development Costs ($13,375,355) Residual Land Value (RLV) $849,400
RLV per Site sf $57
Notes:
(a) Includes the two required onsite units as "Bonus" density, as currently allowed for inclusionary ownership projects. (b) Per Santa Barbara Municipal Code 30.160 - Inclusionary Housing. (b) In determining the number of Inclusionary Units required by Chapter 30.160, Inclusionary Housing, any decimal fraction of 0.5 or more shall be rounded up. (c) Hard Costs include Site Prep work (e.g., grading, minor demolition), and assume Tier 3 Stormwater Requirements. (d) Soft costs shown in this line include engineering, architecture, as well as City cost-recovery fees for planning, permitting, and entitlements, and financing. (e) Per Santa Barbara Unified Developer Fee Schedule, effective October 2024. (f) Based on sales of recently-sold (previous 12 month) condominiums in City of Santa Barbara, adjusted on a price-per-square foot basis to match prototype. (g) Per Published 2025 Maximum Sales Prices by Bedroom Count for "Middle" Income (120-160% AMI) Source: BAE, 2025.

10 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Table 7. Option G.1 (All Fractional), Prototype II
Development Program Assumptions Cost and Income Assumptions Development Cost Analysis Site Size (acres) 0.34 Development Costs Hard Costs
Site Size (sf) 15,000 Construction Hard Costs Residential $8,487,500 Residential, per sf $500.00 (c) Podium Parking $960,000 Total "Base" Units 13 Podium Parking, per space $40,000 Total Dwelling Units 14 (a) Total Hard Costs $9,447,500 Avg. Unit Size (net, sf) 970 Hard Costs per Unit $674,821 Soft Costs (as a % of hard costs) 15% (d) Hard Costs per Gross Building sf $557 Gross Building Area (sf) 16,975
Net (% of gross res. area) 80% School Fee (per sf residential) $3.79 (e) Soft costs $1,417,125 Net (sf) 13,580 In-Lieu Fee $50.00 School Fee $64,335
In-Lieu Fee $330,795 (h)
Total Parking Spaces 24
Podium Spaces 24 Market-Rate Sales Prices (f) Total Soft Costs $1,812,255 Tuck-Under Spaces 0 Market-Rate 1 BR n/a
Parking Ratio (spaces per dwelling unit) 1.71 Market-Rate 2 BR $1,083,402 Developer Profit $1,688,963 Market Rate 3 BR n/a
Unit Mix % # Total Development Costs (Excl. Land) $12,948,718 One-Bedroom 0% 0 Middle Income Sales Prices (g) Cost per residential sf $763 Two-Bedrooms 100% 14 Middle Income 1 BR $355,700 Cost per residential unit $924,908 Three-Bedrooms 0% 0 Midldle Income 2 BR $444,600
Middle Income 3 BR $503,800 Valuation Analysis
Affordability Share Projected Revenue
Middle/Upper Middle 15% 1.95 (b) Marketing and Sales Costs 5% Gross Sales from Market Rate Units $14,084,226 Middle/Upper Middle (adjusted) 1.0 (% of Sale Price) Sales from Middle-Income 1 BRs $0 Sales from Middle-Income 2 BRs $444,600
Fractional Unit Required 0.95 Developer Profit 15% Sales from Middle-Income 3 BRs $0 (as % of total hard and soft costs) Total Gross Revenue $14,528,826 Affordable Breakdown Aff Market
One-Bedroom 0.0 0.0 Less Marketing Costs ($726,441)
Two-Bedrooms 1.0 13.0 Less Total Development Costs ($12,948,718) Three-Bedrooms 0.0 0.0 Residual Land Value (RLV) $853,666 Total 1.0 13.0
RLV per Site sf $57
RLV Base $57
Notes:

Highlights show differences from Baseline pro-forma.
(a) Option G.1: Includes the one provided onsite unit as "Bonus" density, as currently allowed for inclusionary ownership projects. Maintains same average unit size as Baseline, reducing gross building and net residential area.
(b) Recommendation B: IHO requires Ownership projects w/ 10+ units to include fifteen percent (15%) of the units be sold at prices affordable to Middle- or Upper-Middle-Income households.
(c) Hard Costs include Site Prep work (e.g., grading, minor demolition), and assume Tier 3 Stormwater Requirements. (d) Soft costs shown in this line include engineering, architecture, as well as City cost-recovery fees for planning, permitting, and entitlements, and financing. (e) Per Santa Barbara Unified Developer Fee Schedule, effective October 2024. (f) Based on sales of recently-sold (previous 12 month) condominiums in City of Santa Barbara, adjusted on a price-per-square foot basis to match prototype. (g) Per Published 2025 Maximum Sales Prices by Bedroom Count for "Middle" Income (120-160% AMI) (h) Recommendations D, H, and Option G.2: In-Lieu Fee Payment = Fractional Remainder ÷ Total Inclusionary Requirement x $50.00 x Net Floor Area.

Source: BAE, 2026.

11 Inclusionary Housing Ordinance Amendments Attachment 4 Financial Feasibility Analyses
Table 8. Option G.2 (“Fee Out”), Prototype II
Development Program Assumptions Cost and Income Assumptions Development Cost Analysis Site Size (acres) 0.34 Development Costs Hard Costs
Site Size (sf) 15,000 Construction Hard Costs Residential $7,881,250 Residential, per sf $500.00 (c) Podium Parking $960,000 Total "Base" Units 13 Podium Parking, per space $40,000 Total Dwelling Units 13 (a) Total Hard Costs $8,841,250 Avg. Unit Size (net, sf) 970 Hard Costs per Unit $680,096 Soft Costs (as a % of hard costs) 15% (d) Hard Costs per Gross Building sf $561 Gross Building Area (sf) 15,763
Net (% of gross res. area) 80% School Fee (per sf residential) $3.79 (e) Soft costs $1,326,188 Net (sf) 12,610 In-Lieu Fee $72.53 School Fee $59,740
In-Lieu Fee $914,603 (h)
Total Parking Spaces 24 Total $2,300,531
Podium Spaces 24 Market-Rate Sales Prices (f)
Tuck-Under Spaces 0 Market-Rate 1 BR n/a
Parking Ratio (spaces per dwelling unit) 1.85 Market-Rate 2 BR $1,083,402 Developer Profit $1,671,267 Market Rate 3 BR n/a
Unit Mix % # Total Development Costs (Excl. Land) $12,813,048 One-Bedroom 0% 0 Middle Income Sales Prices (g) Cost per residential sf $813 Two-Bedrooms 100% 13 Middle Income 1 BR $355,700 Cost per residential unit $985,619 Three-Bedrooms 0% 0 Midldle Income 2 BR $444,600
Middle Income 3 BR $503,800 Valuation Analysis
Affordability Share Projected Revenue
Middle/Upper Middle 15% 1.95 (b) Marketing and Sales Costs 5% Gross Sales from Market Rate Units $14,084,226 Middle/Upper Middle (adjusted) 0.0 (% of Sale Price) Sales from Middle-Income 1 BRs $0 Sales from Middle-Income 2 BRs $0
Fractional Unit Required n/a Developer Profit 15% Sales from Middle-Income 3 BRs $0 (as % of total hard and soft costs) Total Gross Revenue $14,084,226 Affordable Breakdown Aff Market
One-Bedroom 0.0 0.0 Less Marketing Costs ($704,211)
Two-Bedrooms 0.0 13.0 Less Total Development Costs ($12,813,048) Three-Bedrooms 0.0 0.0 Residual Land Value (RLV) $566,967 Total 0.0 13.0
RLV per Site sf $38
RLV Base $57
Notes:

Highlights show differences from Baseline pro-forma.
(a) Option G.2: No Bonus Units assumed since Project utilizes “Fee Out” option. Maintains same average unit size as Baseline, reducing gross building and net residential area. (b) Recommendation B: IHO requires Ownership projects w/ 10+ units to include fifteen percent (15%) of the units be sold at prices affordable to Middle- or Upper-Middle-Income households.
(c) Hard Costs include Site Prep work (e.g., grading, minor demolition), and assume Tier 3 Stormwater Requirements. (d) Soft costs shown in this line include engineering, architecture, as well as City cost-recovery fees for planning, permitting, and entitlements, and financing. (e) Per Santa Barbara Unified Developer Fee Schedule, effective October 2024. (f) Based on sales of recently-sold (previous 12 month) condominiums in City of Santa Barbara, adjusted on a price-per-square foot basis to match prototype. (g) Per Published 2025 Maximum Sales Prices by Bedroom Count for "Middle" Income (120-160% AMI) (h) Recommendation H and Option G.2: In-Lieu Fee Payment = Fractional Remainder ÷ Total Inclusionary Requirement x $72.53 x Net Floor Area.

Source: BAE, 2026.

1 Inclusionary Housing Ordinance Amendments Attachment 5 General Plan Consistency Analysis
Attachment 5. General Plan Consistency Analysis
Staff has determined that the Inclusionary Housing Ordinance Amendments are consistent with General Plan policies and programs that support the creation of housing and the prioritization of affordable housing.

Consistency Analysis General Plan Policies
The inclusionary housing ordinance
amendments are consistent with General
Plan policies supporting the creation of
housing.

Housing Element
Goal 1. Create New Housing
Policy 1.8 Flexible Standards
Policy 2.6 Incentives for Middle- and UpperMiddle Income Housing Policy 5.1 Repair and Upgrade Housing
Policy 6.2 Promote Housing
The inclusionary housing ordinance
amendments are consistent with General
Plan policies supporting affordable housing
for a variety of income levels.

Housing Element
Goal 2. Prioritize Affordable Housing
Policy 2.1 Prioritize Affordable Housing and
Community Priority Projects
Policy 2.2 Increase Production of Affordable
Housing
Policy 2.6 Incentives for Middle- and UpperMiddle Income Housing Policy H4.4 Extend Affordability Covenants
Land Use Element
LG5 Community Benefit Housing
LG5.1 Affordable Housing
The inclusionary housing ordinance Coastal Land Use Plan amendments are consistent with the Coastal CLUP 2.1-1 Increased Densities for Affordable Land Use Plan policies supporting the Housing
creation of affordable housing. CLUP 2.1-17 Land Use Categories and Map Designations

2 Inclusionary Housing Ordinance Amendments Attachment 5 General Plan Consistency Analysis
2023-2031 Housing Element Program HE-13: Evaluate Inclusionary Housing Ordinances
The Cityʼs Inclusionary Housing Ordinances have been used to increase the number of affordable units in ownership projects since 2004 and rental housing projects since 2019. In some cases, the developer can pay in-lieu fees rather than the required on-site inclusionary unit(s). In-lieu fees are allocated to a reserve fund intended to increase and improve the supply of deed-restricted affordable housing and ensure compliance with the Cityʼs Affordable Housing Policies and Procedures. There are relatively few projects that pay the in-lieu fees.

Since 2019, 11 deed-restricted moderate-income inclusionary units have been approved and 25 are pending.

Economic studies conducted in 2017 and 2019 evaluated a range of potential inclusionary requirements and in-lieu fees to determine the appropriate balance for the 2019 amendment.

Since then, development costs and rents have increased to the extent that a new study should be conducted.

Evaluation. The City will conduct a feasibility study to determine if the inclusionary requirement or in-lieu fee should be adjusted to produce a greater percentage of deedrestricted affordable housing units or in-lieu funds for affordable housing. The evaluation will also review consistency with “No Net Loss” law to ensure any existing deed-restricted affordable units or other “Protected Units” proposed to be demolished as part of a new housing project are replaced in addition to the required inclusionary units or in-lieu fee.

Zoning Ordinance Amendments. The City shall draft Inclusionary Housing Ordinance amendments for adoption if warranted by the results of the evaluation.

Funding Source: General Fund (staff)
Responsibility: Planning and Housing and Human Services Divisions Time Frame: Feasibility Study Start Date Q2 2024. End Date Q3 2025. Amendments Start Date Q4 2025. End Date Q5 2026.

Corresponding Goal/Policy: Goals 1, 2; Policies 2.1, 2.2, and 2.3

3 Inclusionary Housing Ordinance Amendments Attachment 5 General Plan Consistency Analysis
Coastal Land Use Plan
Land Use & Development
City Planning Efforts & Programs
CLUP 2.1-1 Increased Densities for Affordable Housing. The City may allow for increased densities beyond that established by underlying land use designations and zoning for the following types of affordable housing developments, so long as such development is found consistent with the policies of the Coastal LUP:
• Density Bonus.
• Inclusionary Housing.
• Lot Area Modification for affordable housing only.
• Development Review Policies
CLUP 2.1-17 Land Use Categories and Map Designations. The land use categories and designations in Tables 2.1-1 through 2.1-5 establish the type, density, and intensity of land uses within the Cityʼs Coastal Zone. Figure 2.1-1 Local Coastal Program Land Use Map depicts the land use designation for each property and is intended to provide a graphic representation of policies relating to the location, type, density, and intensity of all land uses in the Coastal Zone. Allowable densities are stated as maximums but may be increased pursuant to an approved Coastal Development Permit that includes density bonus, inclusionary housing, or a lot area modification for affordable housing. However, compliance with the other policies of the Coastal LUP may limit the maximum allowable density of development. Accessory dwelling units are considered accessory uses and are not included as “units” when calculating allowable density.

General Plan Policies
Land Use Element (2011)
LG1 Resource Allocation Priority. Prioritize the use of available resource capacities for additional affordable housing for extremely low, very low, moderate, and middle income households over all other new development.

LG1.1 Affordable Housing. Support affordable housing consistent with Housing Element goals and requirements and develop incentives in the form of flexibility in densities or standards for affordable housing projects if supported by available resource capacities.

4 Inclusionary Housing Ordinance Amendments Attachment 5 General Plan Consistency Analysis
LG5 Community Benefit Housing. While acknowledging the need to balance the provision of affordable housing with market-rate housing, new residential development in multi-family and commercial zones, including mixed-use projects, should include affordable housing and open space benefits.

LG5.1 Affordable Housing. Develop standards and project level findings to encourage the development of Community Benefit Housing defined as: Rental housing, Housing affordable to low, moderate, or middle income households; Employer sponsored workforce housingʼ Limited-Equity Co-operative Housing; Affordable Housing Downtown for Downtown Workers; and/or Transitional housing, single residential occupancy, and other housing for special needs populations including seniors, physically or mentally disabled, homeless, and children aging out of foster care.

LG6.4 Public Housing and All Affordable Partnership Projects. Community Benefit projects such as public housing and partnership projects (e.g., El Carrillo, Garden Court) can be considered at higher densities on a case-by-case basis per the Cityʼs Affordable Housing Policies and Procedures.

Housing Element (2023)
GOAL 1 - Create New Housing. Create new healthy, safe, and energy-efficient housing that meets community needs, within our resources.

H1.4 Reduce Constraints. Reduce and, where feasible and practical, remove unnecessary City-imposed constraints that impede housing development.

H1.8 Flexible Standards. Increase flexibility in multi-unit housing densities and other standards to allow a variety of unit sizes and affordability levels GOAL 2 - Prioritize Affordable Housing. Prioritize housing that is affordable to the workforce and vulnerable communities, by the use of deed restrictions and other measures, over other types of development, with special emphasis on housing that meets the needs of extremely low, very low, low, moderate, and middle income, and special needs households.

H2.1 Prioritize Affordable Housing and Community Priority Projects. Prioritize production of deed-restricted affordable housing and nonresidential community priority projects with broad community benefits over all other land uses and housing types.

H2.2 Increase Production of Affordable Housing. Encourage and provide development opportunities and incentives to increase production of affordable housing.

5 Inclusionary Housing Ordinance Amendments Attachment 5 General Plan Consistency Analysis
H2.3 Ownership Housing. Encourage development of smaller ownership units that provide paths to homeownership for first-time homebuyers, including opportunities for employerprovided housing.

H2.4 Nonprofit Partnerships. Pursue partnership opportunities with nonprofit developers to develop deed-restricted affordable housing on City-owned sites.

H2.5 Rental Housing. Continue to encourage smaller rental units close to transit, and easy walking and biking distance to commercial services and recreational opportunities.

H2.6 Incentives for Middle- and Upper-Middle Income Housing. Develop incentives to facilitate the production of deed-restricted housing affordable for a broader range of household incomes.

H2.7 Local Preference for Housing. To the extent feasible and consistent with other state and federal laws, prioritize affordable housing for lower-income households facing or at risk of displacement to remain in the community.

GOAL 4 - Promote Housing Stability. Implement tenant protection measures, promote fulltime occupancy of existing housing, and discourage conversion of housing to other uses.

H4.4 Extend Affordability Covenants. Encourage and promote the use of public and private funding to extend affordability covenants on units at risk of conversion to market-rate, and to provide rent security for residents.

GOAL 5 - Preserve Housing. Maintain and improve the physical condition of existing housing at all affordability levels.

H5.1 Repair and Upgrade Housing. Encourage the maintenance and repair of existing renter- and owner-occupied housing to prevent deterioration and assist property owners that can demonstrate financial need in upgrading substandard units.

GOAL 6 - Engage the Community. Educate and support the community on housing issues, affordable housing opportunities, and available resources and programs.

H6.2 Promote Housing. Develop campaigns that raise awareness about the importance of and need for housing and affordable housing citywide and encourage public participation in the formulation and review of housing programs. Build and maintain relationships with local journalists, media outlets, neighborhood groups, and community organizations to help expand awareness of housing challenges, initiatives, needs, and resources.

GOAL 8 - Fund Affordable Housing. Develop a permanent source of local funding to produce deed-restricted affordable housing.

6 Inclusionary Housing Ordinance Amendments Attachment 5 General Plan Consistency Analysis
H8.1 Affordable Housing Funding. Identify new funding sources and strategies to support affordable housing.

Agenda Item No. 1
Agenda Item No. 2

CITY OF SANTA BARBARA
Council Agenda Report
Agenda Date: October 6, 2026
To: Mayor and Councilmembers
From: City Administrator’s Office
Subject: Employee Recognition – Service Award Pins
Recommendation:

That Council authorize the City Administrator to express the City’s appreciation to employees who are eligible to receive service award pins for their years of service through October 31, 2026.

Discussion
The City appreciates the loyalty to the community and the dedication to public service that are demonstrated by City employees throughout the organization every day. Since 1980, the City Employees’ Recognition Program has recognized length of City Service. Service award pins are presented to employees for every five years of service. Those employees achieving 25 years of service or more are eligible to receive their pins in front of the City Council.

Attached is a list of those employees who will be awarded pins for their service through October 31, 2026
Attachment:

1. October 2026 Service Awards
Prepared and
Submitted by: Nicole Grisanti, City Administrator’s Office Manager Approved by: Kelly McAdoo, City Administrator
Agenda Item No. 3

ATTACHMENT
OCTOBER 2026 SERVICE AWARDS
October 6, 2026 Council Meeting
5 Years
Gina Garrett, Litigation Paralegal I, City Attorney’s Office Justin Cure, Information Technology Director, Information Technology Department Michael Lopez, Fire Services Specialist, Fire Department Kendra Moss, Librarian II, Library Department
10 YEARS
Dennys Reyes, Police Sergeant, Police Department
Raymond Layco, Police Officer, Police Department
Collin Powell, Police Officer, Police Department
Jessica Gonzalez, Accounting Assistant, Public Works
Michael Fry, Water Treatment Plant Operator III, Water Resources Department Timothy Bolton, Administrative Analyst III, Sustainability & Resilience Department Antonio Diaz, Waterfront Maintenance Worker II, Waterfront Department Philip Moreno, Waterfront Maintenance Worker II, Waterfront Department 20 YEARS
Justin Cruz, Police Officer, Police Department
Ethan Ragsdale, Police Lieutenant, Police Department
Margaret Styczynski, Parking Enforcement Officer, Police Department Hammurabi Days, Water Service Superintendent, Water Resources Department 1 Ordinance No.

AN ORDINANCE OF THE COUNCIL OF THE CITY OF SANTA

BARBARA AMENDING THE SANTA BARBARA MUNICIPAL

CODE TO PRESERVE AFFORDABLE HOUSING AND PROTECT

TENANT AND LANDLORD RIGHTS BY THE ADDITION OF
CHAPTER 26.90 RELATING TO RESIDENTIAL RENT
STABILIZATION AND CHAPTER 26.100 RELATING TO

RESIDENTIAL RENTAL REGISTERY
THE CITY COUNCIL OF THE CITY OF SANTA BARBARA DOES ORDAIN AS FOLLOWS:

Section 1.

Title 26 of the Santa Barbara Municipal Code is amended by adding Chapter26.90, which reads as follows:

CHAPTER 26.90. RESIDENTIAL RENT STABLIZATION

26.90.010 General Application.

A. This Chapter applies to all residential rental units in the City except:

1. Rental units for which a certificate of occupancy was issued (or final inspection on a building permit application for construction of the unit was completed) on or after February 1, 1995.

2. Rental units that are alienable separate from title to any other dwelling unit or are a subdivided interest in a subdivision, as specified in subdivision (b), (d), or (f) of Section 11004.5 of the California Business and Professions Code. This exception does not apply to any of the following:
a. A rental unit where the preceding tenancy has been terminated by the owner by notice pursuant to California Civil Code Section 1946.1 or has been terminated upon a change in the terms of the tenancy noticed pursuant to California Civil Code Section 827;
b. A condominium dwelling or unit that has not been sold separately by the subdivider to a bona fide purchaser for value.

Agenda Item No. 5
2 3. Rental units within a mobilehome or permanent recreational vehicle park and subject to the provisions of Chapter 26.08 of this Code.

B. When a rental unit is exempt from this Chapter under Paragraph 2 of Subsection A, in addition to any other notice required to be given by law and concurrently with the offer of a lease under Section 26.40.010 of this Code, a landlord renting the rental unit shall provide each tenant or prospective tenant written notice that the rental unit is exempt from this Chapter, including reference to the specific basis for the exemption.

Section 26.90.015 Additional Exemptions
A. Notwithstanding the general application of Section 26,90.010, the following rental units are exempt from the requirements of this Chapter:

1. Rental units in hotels, motels, inns, lodging and rooming houses, and boarding houses, or other similar temporary lodgings, including lawfully permitted short term vacation rentals, provided that the occupancy is for 30 days or fewer. The computation of the 30 days shall include days in which the tenant was required to:
a. Move into a different guestroom or efficiency unit before the expiration of 30-day occupancy;
b. Check out and re-register before the expiration of 30-day occupancy to avoid application of this ordinance, or
c. Enter into successive or overlapping rental agreements, extensions, or renewals, whether for the same or a different unit, before the expiration of 30 dayoccupancy.

2. Rental units in:
a. A hospital, convent, monastery, extended medical care facility, asylum, non-profit home for the aged;
b. A facility that has the primary purpose of operating a treatment or recovery program, where such rental units are contingent upon a client's participation in the treatment or recovery program and where the client has been informed in writing of the 3 temporary or transitional nature of the housing at the inception of his or her participation in the program.

3. Rental units owned, leased, operated, or managed by a public agency or notfor-profit organization and subject to a recorded covenant or other restriction that requires renting the unit at rents affordable to very low-, low-, or moderate-income households according to affordability standards adopted by a local, state, or federal agency.

4. Rental Units where the landlord is participating in a federally subsidized tenant-based rental assistance program (commonly referred to as Section 8) so long as the contract rent for the unit is equal to or below the adopted payment standard established by the Housing Authority of the City of Santa Barbara. This exemption applies only so long as the unit is participating in the rental assistance program.

5. Rental units that a government unit, agency or authority owns, operates, or manages, if an applicable federal or state law or administrative regulation specifically exempts such units from municipal rent control.

B. In addition to any other notice required to be given by law and concurrently with the offer of a lease required under Section 26.40.010 of this Code, a landlord renting a unit that is exempt under this Section shall provide each tenant or prospective tenant of the exempt rental unit with a written notice that the rental unit is exempt from this Chapter, including reference to the specific basis for the exemption.

26.90.020 Definitions.

The definitions in this Section apply to the interpretation of this Chapter.

Annual general adjustment. Annual general adjustment means the rental adjustment described in Section 26.90.040 of this Chapter.

Base rent. Base rent means either: (1) the rent for a rental unit in effect on December 16, 2025, for tenancies commenced on or before December 16, 2025, or (2) the rental rate established upon initial occupancy of a rental unit for tenancies commenced after December 4 16, 2025, provided the rental rate is established in accordance with applicable law. The base rent as defined in this section for a tenancy that commended on or before December 16, 2025, shall apply notwithstanding any provision of any new or amended rental agreement for the continued occupancy of the rental unit by a tenant that purports to establish a higher rent.

Base year. Base year for the purposes of making fair return determinations under Section

26.90.050 means the 2025 calendar year. If the rent for a covered rental unit is increased because of a general annual adjustment under Section 26.90.040 or a fair return adjustment under Section 26.90.050, then the base year for any subsequent petition under Section

26.90.050 shall be the year that was considered the "current year" in the immediately preceding petition.

Capital Improvement. Capital Improvement means an improvement, addition or major repair to a rental unit or common areas of the housing complex containing the rental unit, for the benefit of tenants, that has a useful life of five years or more and that is required by federal income tax law to be amortized over the useful life of the improvement. Capital improvement does not include normal or routine maintenance, repair, or replacements. A capital improvement must be permanent/fixed in nature rather than temporary or movable and must not primarily relate to a service or amenity for which tenants pay separately from rent. Capital Improvement does not include work performed to correct a notice of violation or other notice by a government agency ordering repairs. Capital improvement does not include an improvement completed before December 31, 2025.

City Administrator. City Administrator means the person holding the office of city administrator of the City including any city employee exercising authority delegated by the City Administrator.

City Council. City Council means the elected governing body of the City of Santa Barbara.

Change in Consumer Price Index or CPI. Change in consumer price index or change in CPI means the percentage change in the CPI as defined in this section calculated as follows:
5 A. For rent increases that take effect in any calendar year, the following shall apply:

1. The percentage change shall be the percentage change in the CPI amount published for April of the immediately preceding calendar year and April of the year before that.

2. If there is not an amount published in April for the area that includes the County of Santa Barbara, the percentage change shall be the percentage change in the CPI amount published for March of the immediately preceding calendar year and March of the year before that.

B. The percentage change shall be rounded to the nearest one-quarter of 1 percent.

Consumer Price Index or CPI. Consumer Price Index or CPI means the California Consumer Price Index for All Urban Consumers for All Items as published by the Department of Industrial Relations. If the United States Bureau of Labor Statistics publishes a CPI-U index for a metropolitan area that includes the County of Santa Barbara, then that CPI-U index will be used for the calendar year in which in that CPI-U, is first published and following years.

Should there be no such index, or should there cease to be such an index, the Program Administrator shall designate by regulation an index that is most comparable to the CPI-U index for a metropolitan area that includes the County of Santa Barbara.

Covered rental unit. Covered rental unit means any rental unit not specifically exempted under Section 26.90.010.

Day. Day means calendar day.

Fair return. Fair return means an economic return on property as determined by using the standard outlined in Section 26.90.060.

Hearing officer. Hearing officer means a person appointed by the City Administrator to conduct an investigation or administrative hearing under this Chapter. 6 Housing services. Housing services means any benefit, privilege, arrangement, or facility provided or contracted for in connection with the use or occupancy of any rental unit including, but not limited to: repairs; maintenance; painting; lighting; heating and air conditioning; hot and cold water service; electricity, gas, Internet, telecommunications, sewer, refuse collection, or other utility services; elevator service; window shades and screens; storage; kitchen, bath and laundry facilities and privileges; janitor services; utility charges that are paid by the landlord; parking; common areas; recreational facilities; the right to have a specified number of occupants; the right to a specific number of pets; access rights; and furnishings. . Housing services to a rental unit include a proportionate part of services provided to common facilities of the building in which the rental unit is contained.

Landlord. Landlord means an owner, lessor, sublessor or any other person entitled to receive rent for the use and occupancy of any rental unit, including an agent, representative, predecessor, or successor of any of the foregoing.

Program Administrator. Program Administrator means the City employee designated by the City Administrator to administer this Chapter.

Property. Property means all rental units under common ownership on a parcel, lot, or contiguous parcels or contiguous lots.

Rent. Rent means all periodic payments under a rental housing agreement concerning the use or occupancy of a rental unit, including all payments and other consideration demanded or paid for housing services. Rent does not include refundable security deposits or avoidable fees imposed by a landlord such as fees for late payment of rent or for checks returned for insufficient funds. Rent includes the value of any non-monetary consideration that a tenant provides to a landlord under the terms of a rental agreement or that a landlord may be otherwise demanded from a tenant in connection with the use or occupancy of a rental unit or provision of housing services.

Rent increase. Rent increase, increase of rent, or upward adjustment of rent includes any reduction, suspension, or termination of any housing service unless there is a simultaneous and corresponding reduction in rent.
7 Rent Stabilization Board. The Rent Stabilization Board is the board established by this Chapter.

Rental agreement. Rental agreement means an agreement, whether oral, written, or implied, between a landlord and tenant for use or occupancy of a rental unit and for housing services. For the purpose of this Chapter, the terms “rental agreement” and “lease” are interchangeable.

Rental registry. Rental registry means the database of information on rental units in the City required by Chapter 26.100 of this Code.

Rental registry fee. Rental registry fee means the fee described in Chapter 26.100 of this Code.

Rent Stabilization Program. The Rent Stabilization Program means the personnel and policies that implement and enforce this Chapter.

Rental unit. Rental unit means any building or structure, or part thereof, land appurtenant thereto, or any other property rented or offered for rent for residential purposes, together with all housing services connected with use or occupancy of such property. A unit may qualify as such with or without a valid certificate of occupancy for use as rental housing.

Security deposit. Security deposit means any payment, fee, deposit, or charge as defined in Section 1950.5 of the California Civil Code.

Tenant. Tenant means any tenant, subtenant, lessee, sublessee or any other person entitled under the terms of a rental agreement to occupy a rental unit.

26.90.030 Stabilization of Rents.

A. Beginning January 1, 2027, a landlord is prohibited from charging rent for a covered rental unit in an amount that exceeds the sum of the base rent plus any lawful rent increases authorized under this Chapter.

B. Beginning January 1, 2027, a landlord is prohibited from increasing rent for a covered rental unit except in an amount permitted under Sections 26.90.040, 26.90.050, or

26.90.060.
8 C. Notwithstanding Subsection A of this Section, a landlord may set the initial rent for a new tenancy following the lawful vacancy of a covered rental unit, subject only to limitations of California statute. After the initial rent for a covered rental unit has been set, a landlord may not increase rent except as provided in subsection B of this Section.

D. If a landlord increased the rent for a covered rental unit after December 16, 2025, but before January 1, 2027, in accordance with applicable law, then the percentage amount of that increase above the base rent will be counted in full against percentage of rent increases above the base rent authorized under this Chapter until the rent increase authorized under this Chapter exceeds the prior rent increase. The Program Administrator, with the approval of the Rent Stabilization Board, shall adopt regulations to implement this requirement.

E. No more than one rent increase per twelve-month period may be imposed on a tenant.

F. A violation of this Section occurs upon the delivery to a tenant of a notice or demand for a prohibited increase in rent.

G. As part of any notice to increase rent, introduce a new rental agreement, or renew or change any terms of an existing rental agreement, a Landlord must include:
1 Notice of the existence of this Chapter, and;

2. Notice that no rent increase shall take effect until the requirements of this Chapter have been met.

26.90.040 Annual General Rent Adjustment.

A. No later than October 1 each year, the Program Administrator will determine and post on the City’s Rent Stabilization Program webpage the amount of the annual general adjustment, which will be effective as of January 1 of the following year.

B. The annual general adjustment will be equal to 60% of annual percentage change in the Consumer Price Index or 3%, whichever is less. If the percentage change in the Consumer Price Index is negative, the annual general adjustment will be zero.

C. A landlord who seeks to raise rent by the annual general adjustment must do so before the end of the calendar year for which the adjustment amount is determined under 9 subsection A. A landlord who fails to implement a rent increase pursuant to the annual general adjustment during such period may not defer implementation of the annual general adjustment to a later year or from year-to-year.

D. Allowable annual general adjustment rent increases under this Section shall become effective only after the landlord provides notice to the tenant in the manner prescribed by law, with at least 30 days' advance written notice.

E. An annual general rent adjustment may not be applied to any covered rental units if the landlord has failed:

1. To maintain the rental unit in compliance with California Civil Code Sections 1941.1 et seq. and California Health and Safety Code Sections 17920.3 and 17920.10; or

2. Has failed to make repairs ordered by a court or by the City Building Official.

26.90.050 Petition for Special Adjustment – Fair Return.

A. A landlord may file a petition with the Program Administrator seeking adjustment of the rent for any given tenancy in accordance with the standards stated in this Section and using the procedures stated in Section 26.90.080 and implementing regulations. A petition must be accompanied by a declaration by the landlord that each covered rental unit for which the petition is submitted complies with all the requirements of this Chapter, including an express declaration that the landlord has maintained the rental unit in compliance with California Civil Code Sections 1941.1 et seq. and California Health and Safety Code Sections 17920.3 and 17920.10.

B. Upward rent adjustments may be granted only when the landlord demonstrates by a preponderance of evidence, and the hearing officer or Rent Stabilization Board on appeal finds based on substantial evidence in the record of a hearing, that such adjustments are necessary to provide the landlord a fair return as required by the California and United States Constitutions.

C. No upward rent adjustments may be authorized under this Section if the landlord has failed to maintain the covered rental unit or units in compliance with California Civil Code 10 Sections 1941.1 et seq. and California Health and Safety Code Sections 17920.3 and 17920.10.

D. The following presumptions apply to the evaluation of petitions under this Section.

1. The net operating income received by the landlord in the base year provided a fair return.

2. The base rent for a covered rental unit provided a fair return when it was established.

E. For purposes of determining a fair return there is a rebuttable presumption that maintenance of net operating income equal to the base year net operating income adjusted by the change in the Consumer Price Index from the base year to the current year results in a fair rate of return. The current year CPI shall be the annual CPI for the calendar year preceding the calendar year in which an application is filed. While it is presumed that the maintenance of net operating income standard under this Section provides a fair return, nothing in this Section prevents the hearing officer or Rent Stabilization Board from granting or denying a rent increase based upon substantial evidence in the record of a hearing.

F. The presumption of fair return under subsection E of this Section may be rebutted by evidence supporting at least one of the following findings:

1. The landlord's operating expenses in the base year were unusually high or low.

2. The gross income during the base year was disproportionately low due to exceptional circumstances. In such instances, adjustments may be made when calculating base year gross rental income consistent with the purposes of this Chapter. The following factors may be considered when making such a finding:
a. If the gross income during the base year was lower than it might have been because some tenants were charged reduced rent.
b. If the gross income during the base year was significantly lower than normal because of temporary vacancy for construction or repairs. 11 c. The pattern of rent increases or decreases in the years prior to the base year and whether those changes reflect market rent for comparable units. . d. Other exceptional circumstances as established by regulation adopted by the Program Administrator or Rent Stabilization Board.

G. Net operating income shall be calculated by subtracting from gross operating income operating expenses that are directly related or attributable to the property and rental units for which the rent adjustment is sought. The following principles apply to the calculation of net operating income:

1. Gross rental income includes:
a. Gross rents calculated based on the amount of rent lawfully collectable at 100% occupancy.
b. All other income or consideration received or receivable in connection with the use or occupancy of the rental unit or units, except items excluded from gross rental income under this subsection.

2. Gross rental income excludes:
a. Utility charges for sub-metered gas, electricity or water. b. Charges for refuse disposal, sewer service, or other similar services that are either provided solely on a cost pass-through basis or are regulated by state or local law. c. Charges for laundry services.
d. Storage charges.
e. Additional rents imposed upon tenants that are supplementary to the primary rent, such as "pet rent."

3. Operating expenses include:
a. Reasonable costs of operation and maintenance.
b. Reasonable management expenses.
12 c. Cost of utilities such as water, sewage, gas, electricity, or communication systems that are provided by a public agency or private utility company and paid by the landlord.
d. Property taxes attributable to an assessment for the base year and for the current year. Property taxes attributable to assessments in any other year shall not be considered when calculating operating expenses.
e. License and registration fees required by law to the extent these expenses are not otherwise paid or reimbursed by tenants. f. Landlord-performed labor compensated at reasonable hourly rates.

However, no landlord-performed labor shall be included as an operating expense unless the landlord submits documentation showing the date, time, and nature of the work performed.

The maximum allowed for landlord-performed labor shall not exceed 5% of gross income unless the landlord shows greater services were performed for the benefit of the residents. g. Reasonable attorneys' fees and costs necessary to the operation of the property for rent, excluding attorneys’ fees incurred with respect to a petition under this Chapter.
h. Up to 50 percent of the annual fee paid in connection with the rental registry under Chapter 26.100.

4. Operating expenses do not include:
a. Capital improvement expenses. Adjustments for capital improvement expenses may be obtained under Section 26.90.060.
b. Mortgage principal or interest payments or other debt service costs. c. Late fees, penalties, or interest resulting from the landlord’s failure to timely pay any operating expenses. Any penalties, fees or interest assessed or awarded for violation of any provision of this Chapter or of any other provision of law. d. Land lease expenses.
13 e. Political contributions.
f. Payments to persons or organizations that are substantially devoted to legislative lobbying.
g. Depreciation.
h. Any expenses for which the landlord has been reimbursed by any utility rebate or discount, security deposit, insurance settlement, judgment for damages, settlement or any other method or device.
i. Unreasonable increases in expenses since the base year. j. Cost of utility services such as water, sewage, gas, electricity, or communication systems that are provided by a public agency or private utility company and paid directly by the tenant.
k. Expenses attributable to unreasonable delays in performing necessary maintenance or repair work or the failure to timely and competently complete necessary replacements.

5. Base year or current year operating expenses may be averaged or adjusted, as appropriate based on the preponderance of the evidence, to establish an expense amount that best achieves a reasonable comparison of base year and current year expenses. The petitioner must request and identify any proposed averaging or adjustment and bears the burden of proof by a preponderance of the evidence. Grounds for such adjustments include, but are not limited to:
a. An expense item for a particular year that is not representative. b. A base year expense for an item is not a reasonable reflection of average past expenses for that item in the years immediately preceding or following the base year. c. A current year expense for an item is not a reasonable projection of future year expenses for that item.
14 d. A particular expense exceeds industry standards for the geographic area that includes the City.
e. A base year expense was exceptionally low by industry standards, provided that the low expense was not caused by a reduction of service, maintenance, or amenities.
f. An increase in maintenance or management expenses that is disproportionate to the percentage change in the CPI, while the level of services has not changed significantly or the increase is not justified by exceptional circumstances.

H. When a cost is required by federal income tax law to be amortized, an interest allowance on the cost of amortized expenses may be considered at a rate equal to the "average rate" for the thirty-year fixed rate on home mortgages plus 2%. The "average rate" shall be the rate Freddie Mac last published in its weekly Primary Mortgage Market Survey (PMMS) as of the Petition’s initial submission date. If this rate is no longer published, the Program Administrator shall designate by regulations an index that is most comparable to the PMMS index.

I. If the time a hearing officer or the Rent Stabilization Board devotes to determining the allowable rent increase pursuant to this Section exceeds 120 days after the acceptance by the Program Administrator of a complete application and the landlord did not request, cause, or contribute to the delay, then the landlord may recover increases that would have been permitted if the rent increase decision had been made within 120 days. The allowance for these increases may be amortized or may be factored into the prospective allowable increase to avoid undue hardship on tenants.

J. Rent increases authorized by this subsection shall become effective only after the landlord provides the tenant written notice of such rent increase pursuant to state law.

26.90.060 Petition for Special Adjustment – Capital Improvements.

A. A landlord that has obtained an approved capital improvement plan under Section

26.90.100 may file a capital improvement petition with the Program Administrator seeking a rent adjustment for any given tenancy and requesting a pass-through cost to the tenants to 15 cover expenses incurred by the landlord to complete reasonable capital improvements for or attributable to the rental unit. The petition must be filed in accordance with the standards stated in this Section and using the procedures stated in Section 26.90.080 and any implementing regulations. A petition must include a declaration by the landlord that the covered rental units comply with all requirements of this Chapter, including an express declaration that the landlord has maintained the rental unit in compliance with California Civil Code Sections 1941.1 et seq. and California Health and Safety Code Sections 17920.3 and 17920.10.

B. Capital improvements eligible for pass-through cost under this Section must be made according to an approved capital improvement plan and are limited to the following:

1. A new roof covering all or substantially all of a building or a structurally independent portion of a building.

2. A significant upgrade of a foundation, including seismic retrofits, of all or substantially all of a building or a structurally independent portion of a building. 3 A new or substantially new plumbing, electrical, or heating, ventilation, and air conditioning (HVAC) system in one or more rental units.

4. Exterior painting or installation/replacement of siding or stucco on all or substantially all of a building.

5. Repairs reasonably related to correcting or preventing the spread of defects that are noted in findings in a Wood Destroying Pest and Organisms Report issued by a pest control company registered in Branch 3 of the State of California Structural Pest Control Board.

6. The installation of water conservation devices that are intended to reduce the use of water; the installation of energy efficient devices, such as a solar roof system, or converting utilities from gas to electric, that are intended to save energy or reduce greenhouse gases; replacement of single-glazed windows with dual-glazed windows.

7. Improvements or upgrades to the rental unit or the building/complex that meet or exceed disability/accessibility standards as required by law. 16 8. A fire sprinkler or fire alarm system covering all or substantially all of a building.

9. Replacement of stairs and/or railings in all or substantially all of a building.

10. Installation of electric vehicle charging stations.

11. Lead based paint stabilization and abatement.

C. No adjustment for a capital improvement may be authorized by a hearing officer or the Rent Stabilization Board under this Section if the landlord has failed to maintain the covered rental unit or units in compliance with California Civil Code Sections 1941.l et seq. and California Health and Safety Code Sections 17920.3 and 17920.10, or if the capital improvement has been ordered to correct the violation of any law or regulation relating to building habitability or safety for human occupancy.

D. A capital improvement petition must be initiated by the landlord within two years of completing the capital improvement. Capital improvement, as defined in Section 26.90.020, does not include an improvement completed before or during the initial base year.

E. A capital improvement petition shall not apply to rental units or tenants for which the initial rent was established after commencement of the capital improvement for which a rent adjustment is sought;
F. A landlord may not require a tenant to pay any amount of any cost that is attributable to any period of time that the tenant was not entitled to use and occupy the rental unit; G. A landlord may not require a tenant to pay more than the tenant's share of the cost of a capital improvement attributable to that tenant's rental unit that is permitted to be passed through pursuant to a petition.

H. If a capital improvement benefits one or more, but less than all of the covered rental units on a property, then the rent adjustment under this Section shall be applied only to the rental units receiving the benefit, as determined by the hearing officer or Rent Stabilization Board.
17 I. The approved monthly pass-through adjustment costs for capital improvements shall be separately itemized on the rental statement provided to a tenant, and it shall not be included in the calculation of future rent adjustments under either Section 26.90.040 or

26.90.050.

J. Capital Improvement pass-through adjustments must be determined according to the following:

1. Capital Improvement costs may be amortized over the useful life of the capital improvement but may not result in a monthly pass through cost that exceeds 10% of the current monthly rent or $100 whichever is less. For the purposes of such computation, the current rent for any period shall not include any capital improvement pass-through amounts;

2. For mixed-use structures and landlord-occupied rental units, only the percentage of residential square footage will be applied in the calculations;

3. If a unit is occupied by an agent of the landlord, this unit must be included when determining the average costs per rental unit; and

4. If the landlord is reimbursed for capital improvements (i.e. through insurance, court-awarded damages, subsidies, etc.), such reimbursement must be deducted from the capital improvements costs before the costs are amortized and allocated among the rental units.

5. When a cost is required to be amortized, an interest allowance on the cost of amortized expenses may be considered at a rate equal to the "average rate" for the thirtyyear fixed rate on home mortgages plus two 2%. The "average rate" shall be the rate Freddie Mac last published in its weekly Primary Mortgage Market Survey (PMMS) as of the Petition’s initial submission date. If this rate is no longer published, the Program Administrator shall designate by regulations an index that is most comparable to the PMMS index.

26.90.070 Tenant Petition for Downward Adjustment.

A. A tenant petition may be filed under Section 26.90.080 to adjust rent downward based on a loss in rental value attributable to the landlord's failure to maintain a covered rental unit or units in habitable condition. Failure to maintain a covered rental unit in compliance with 18 governing health and safety and building codes, including but not limited to California Civil Code Sections 1941.1 et seq. and California Health and Safety Code Sections 17920.3 and 17920.10, constitutes a rent increase. A tenant petition under this subsection must specify the conditions alleged to constitute the failure to maintain the rental unit or units in habitable condition and describe how the landlord was provided with reasonable notice and opportunity to correct the conditions alleged in the petition.

B. A tenant petition may be filed under Section 26.90.080 to adjust rent downward based on a loss in rental value attributable to a reduction, suspension, or termination of any housing service, a decrease of maintenance, or deterioration of the rental unit. A reduction, suspension, or termination of any housing service, a decrease of maintenance, or deterioration of a covered rental unit beyond ordinary wear and tear, without a corresponding reduction in rent, is considered a rent increase. A tenant petition under this subsection must specify the conditions alleged to constitute the reduction, suspension, or termination of housing service, a decrease of maintenance, or the deterioration of the rental unit and it must describe how the landlord was provided with reasonable notice and opportunity to correct the conditions alleged in the petition.

C. A tenant petition may be filed under Section 26.90.080 to adjust rent downward to its lawful level if a landlord demands or retains rent exceeding the lawful rent permitted by this Chapter. If such a petition is granted, the landlord shall be ordered to return any excessive rent charged to the tenant. The hearing officer or Rent Stabilization Board may order the landlord to return the excess amount of the overcharged rent to a tenant within 30 days of the issuance of the order or, at the tenant’s request may authorize the tenant to withhold a fraction of the downward-adjusted rent until the tenant has recovered the overcharged rent amount. The withholding fraction and duration shall be determined by the hearing officer or Rent Stabilization Board. Further, if the landlord is ordered to repay the excess rent amount within 30 days and fails to do so, the tenant may withhold the excess rent amount from future rent payments in an amount determined by the tenant until the tenant has recovered the overcharged rent amount. During the withholding period, the downward-adjusted rent minus the withholding amount shall be considered the lawful rent to which the landlord is legally entitled.
19 D. The petition order shall constitute a defense to any unlawful detainer action filed against a tenant withholding rent as authorized under this subsection. However, nothing in this subsection shall be construed to prevent a tenant from asserting previous overpayments of rent as a defense in an unlawful detainer proceeding.

E. If a tenant vacates the covered rental unit before recovering the full amount of overpayment as determined in the petition order, the landlord must pay the balance of the amount owed within two weeks of the tenant vacating the rental unit.

26.90.080 Petition Procedures.

A. A landlord, tenant, or group of tenants may file petitions with the Program Administrator for adjustments under Sections 26.90.050, 26.90.060, or 26.90.070 as provided in this Section. For purposes of the petition process, the landlord and each tenant of a covered rental unit that is the subject of a petition shall be a "party" to the petition. The Program Administrator may issue regulations regarding procedures and requirements for petitions filed under this Section, subject to approval by or at the direction of the Rent Stabilization Board. Petitions shall be governed by such regulations and by the provisions of this Section. Petitions shall be available in the language that the landlord and tenant used to negotiate the terms of the rental agreement for the tenancy if the rental agreement is in a language other than English.

B. A petition must state the identity and mailing address of the person or persons filing the petition, the covered rental units affected by the petition, the nature of the rental adjustment for which the petition is filed, and a brief statement of the grounds and facts upon which the petition is based. If the petition is filed by a landlord, the petition shall be accompanied by a separate list of the names and mailing addresses, or email addresses if applicable, of the tenants of each of the covered rental units affected by the petition. The separate list will be kept confidential to the extent authorized by law and used by the Program Administrator solely for the purpose of giving notices required by this Section.

C. Within 30 days of filing a petition, the Program Administrator shall notify the petitioner of the acceptance or rejection of the petition based on the completeness of the submission. The Program Administrator shall not assess the merits of the petition and shall 20 only refuse acceptance of a petition that does not include required information or does not comply with the requirements of this Section.

D. Landlords filing petitions shall be responsible for payment of any applicable program fees established by City Council resolution. No landlord petition shall be accepted or processed if the landlord is delinquent on any required fees under this Chapter or Chapter

26.100.

E. A petition may not be accepted or processed if a decision has been made on a prior petition based on the same, or substantially the same grounds, within the previous 180 days.

F. Within 14 days after the acceptance of a petition, the Program Administrator shall provide written notice to the landlord and tenants of the rental units subject to the petition.

The written notice shall inform the parties of the petition process, the right to respond, and the deadline for filing a written response, and it shall include a copy of the completed petition and supportive documents. Any written response submitted by a responding party will be made available to the petitioning party.

G. An impartial hearing officer appointed by the Program Administrator shall conduct a hearing to act upon the petition. The hearing officer has the power to approve, deny, or approve in part and deny in part a petition; to issue orders consistent with this Chapter that are necessary or convenient to conduct a fair hearing; to issue orders consistent with this Chapter to implement a decision on the petition; and to exercise any other powers delegated by regulations promulgated by the Program Administrator and approved by the Rent Stabilization Board. The hearing officer has the power to issue subpoenas. The Hearing Officer has no authority to consider the constitutionality of any federal, state or local law or regulation.

H. The Program Administrator shall schedule each petition accepted for a hearing by the hearing officer to be held on a date not more than 60 days from the date the Program Administrator accepts the petition. With the agreement of the parties, the hearing officer may hold the hearing after the 60 days. The Program Administrator will give written notice of the hearing date to all of the parties not less than 20 days before the date of the hearing. The notice will be given to the mailing address or email address provided to the Program 21 Administrator under subsection B of this Section. Mailed notice will be given by first class mail, postage prepaid and will be deemed complete upon mailing. If notice is given by electronic mail, it will be complete on the sending date.

I. All petitions pertaining to covered rental units on the same property will be consolidated for hearing unless the Program Administrator or hearing officer finds good cause not to consolidate the petitions.

J. All parties to a hearing may have assistance in presenting evidence and developing their positions from attorneys, legal workers, or any other person designated by the parties.

K. All parties may participate in the hearing. The Program Administrator may participate in the hearing to provide interpretations of this Chapter.

L. Formal rules of evidence shall not apply to hearings on petitions. The parties may offer any documents, testimony, written declarations, or other evidence that, in the opinion of the hearing officer, is credible and relevant to the petition. The hearing officer may consider the results of inspections of the property in question and the results of any other investigations conducted by or at the request of the hearing officer. Any relevant evidence, including hearsay evidence, may be considered. Evidence that is unduly repetitious, lacking credibility, or irrelevant shall be excluded upon order by the hearing officer. The hearing officer may establish time limits for the presentation of evidence and argument. Oral testimony shall be on oath or affirmation. The hearing officer is empowered to administer oaths or affirmations.

M. Any party may appear and offer such documents, testimony, written declarations, or other evidence as may be relevant to the proceeding. The hearing officer may require either party to provide any books of accounts, records, or papers deemed by the hearing officer to be relevant. The hearing officer may request the City to conduct a building inspection if the hearing officer finds good cause to believe the information presented does not reflect the current condition of the covered rental unit or units that are the subject of a petition. All documents required under this Section shall be made available to the parties before the hearing.
22 N. The petitioner(s) shall have the burden of proof. A petition may not be granted unless supported by a preponderance of the evidence.

O. The hearing officer shall make a determination on the merits of the petition and shall provide a written statement of decision, including findings upon which the determination is based. The hearing officer's decision may be reasonably conditioned in any manner necessary to carry out the purposes of this Chapter. The hearing officer shall deliver the written statement of decision to the Program Administrator not more than 30 days after the conclusion of the hearing. The Program Administrator will promptly deliver the decision to the parties by first class mail, postage prepaid. Additionally, the parties to the hearing shall be notified of their right to appeal to the Rent Stabilization Board or to judicial review of the decision under Section 1094.5 of the Code of Civil Procedure.

P. The record of the hearing shall include: the petition; any response to the petition; all exhibits, papers, and documents required to be filed or accepted into evidence during the proceedings; a list of participants present; a transcript of the testimony accepted in the proceedings; a statement of all materials officially noticed; all recommended decisions, orders and/or rulings; all final decisions, orders, or rulings; and the reasons for each final decision, order, or ruling. All hearings shall be recorded, and the Program Administrator may arrange for a court reporter upon request of a party.

Q. Any party aggrieved by the decisions of the hearing officer may appeal to the Rent Stabilization Board. An appeal to the board shall be filed with the Program Administrator no later than 30 days after mailing of the written statement of decision by the Program Administrator as provided in Section 26.90.090. If no board exists at the time the appeal is filed, the decision of the hearing officer shall be final subject only to judicial review.

R. The decision of the hearing officer shall not be stayed pending appeal; however, in the event that the board on appeal reverses or modifies the decision of the hearing officer, the board shall order the appropriate party to make retroactive payments, as applicable, to restore the parties to the position they would have occupied had the hearing officer's decision been the same as that of the board.
23 S. The Program Administrator shall give notice of a decision on appeal of the Rent Stabilization Board. The notice will be given in the same manner as the decision of the hearing officer.

T. A final decision of the hearing officer is subject to judicial review only if there is no Rent Stabilization Board appointed at the time the final decision is issued. In such cases, the final decision of the hearing officer is subject to judicial review under Section 1094.5 of the Civil Code and as provided in Chapter 1.30 of this Code, except that judicial review must be commenced in a court of competent jurisdiction not later than 30 days after the date notice of the final decision is given.

26.90.090 Rent Stabilization Board.

A. A Rent Stabilization Board to perform the functions designated in this Chapter is established. The board consists of seven members appointed by the City Council. At least four members must be tenants of rental housing in the City, including one tenant member who is 65 years of age or older. All members must be residents of the City but are not required to be qualified electors. Board members are subject to the requirements of the California Political Reform Act and the Santa Barbara Local Conflict of Interest Code. Board members shall serve for a term of four years or until their respective successors are appointed or qualified, except that three of the initially appointed members, including two of the designated tenant members will be appointed for initial terms of two years. The City Council may remove a board member at any time for any reason and a replacement appointed to serve the balance of the removed member’s term. The Program Administrator is designated as secretary of the board and will provide appropriate administrative and staff support.

B. The Rent Stabilization Board has the following powers and duties:

1. Hold regular meetings as established by resolution of the board, and hold special meetings as scheduled by the Program Administrator.

2. Conduct hearings, adopt regulations consistent with this Chapter for implementation and administration of petitions, and make recommendations to the Program 24 Administrator or City Council regarding the rent stabilization program or this Chapter. The board, in consultation with the City Attorney, may establish procedures for the conduct of appeal hearings.

3. Select a chair and vice chair. The chair and vice chair shall be selected every two years and may serve successive terms. The chair and vice chair serve at the pleasure of the board.

4. Establish procedures for hearings on petitions.

5. Make such studies, surveys, and investigations, conduct such hearings, and obtain such information as is necessary to carry out its powers and duties.

6. Perform other duties as are designated by this Chapter or by resolution or motion of the City Council.

C. All business of the Rent Stabilization Board shall be conducted at meetings held according to the Ralph M. Brown Act and City Council policy. The board shall not create temporary or standing committees. Four members of the board constitute a quorum for the transaction of business. A decision to grant or deny a petition requires the affirmative vote of four board members. All other actions of the board require approval by a majority of a quorum at a meeting.

D. Any party aggrieved by the decisions of the hearing officer may appeal to the Rent Stabilization Board in accordance with Section 26.90.80. An appeal to the board shall be filed with the Program Administrator no later than 30 days after the Program Administrator mails the written statement of decision of the hearing officer. The board shall consider the appeal within 30 days after it is filed and render a decision on the appeal within 30 days after the appellate hearing. On appeal, the board shall affirm, reverse, or modify the decision of the hearing officer. Board review of the hearing officer's decision shall be based on the hearing record without holding a new hearing, unless the Board elects to conduct a de novo hearing.

The board may consider additional evidence for good cause, including evidence which did not exist at the time of the hearing by the hearing officer, or which could not be discovered 25 by the party offering it using due diligence. If no board exists when the appeal is filed, the decision of the hearing officer shall be final subject only to judicial review.

E. A final decision of the Rent Stabilization Board is subject to judicial review as provided in Chapter 1.30 of this Code, except that judicial review must commence in a court of competent jurisdiction not later than 30 days after notice of the final decision.is given. The decision of the board shall take effect immediately, or on such other date as stated in the decision. A decision shall not be stayed pending judicial review except as otherwise ordered by a court of competent jurisdiction.

26.90.100 Capital Improvement Plans.

A. Capital improvement plan means a detailed proposal submitted to the Program Administrator by a landlord to proceed with one or more capital Improvements when either or both of the following conditions apply:

1. The landlord intends to file a petition under Section 26.90.060; or

2. The capital improvement will result in the temporary relocation or eviction of a tenant.

B. A landlord may not apply for a capital improvement plan with respect to the same rental units or property more frequently than once every 24 months except for capital improvements the Program Administrator determines are made necessary by:

1. A fire, flood, earthquake or other natural disaster;

2. An event beyond the control of the landlord and the landlord did not cause or contribute to the condition that requires the capital improvement; or

3. A health or safety condition that did not exist when the landlord filed the prior application for a capital improvement plan and that condition has caused or resulted in an order from a governmental agency or a court of competent jurisdiction to vacate the rental unit, provided that the health or safety condition was not caused by the landlords failure to undertake ordinary maintenance and repairs.
26 C. A Landlord who has applied to the Program Administrator for a capital improvement plan shall:

1. Provide to the Program Administrator documentation of the estimated cost of the capital improvements, a complete description of the proposed capital improvements, the proposed construction schedule, rental units and names of the tenants of each unit affected by the application, proof of notification of tenants as required by paragraph 2 of this subsection.

2. Notify each tenant in writing that the landlord has applied for a capital improvement plan and whether, as part of that application, the landlord is requesting the tenant’s tenancy be temporarily interrupted or whether a no-fault just cause eviction for substantial remodel will be required in connection with the capital improvement.

D. If implementation of the capital improvement plan will result in eviction of a tenant due to a substantial remodel as defined in Chapter 26.50 of this Code, the landlord must comply with that Chapter before commencement of the capital improvements. If implementation of the capital improvement plan will not result in eviction of a tenant under Chapter 26.50, but will result in displacement of a tenant from a rental unit for fewer than thirty days, the capital improvement plan must demonstrate how the landlord will comply with the following requirements:

1. The tenant shall be immediately entitled to short-term relocation payments from the landlord as set out in Subsection 26.90.130(G)(3). The tenant may choose not to receive short-term relocation payments. If the tenant receives short-term relocation payments, the tenant remains obligated to pay to the landlord the lawful rent in effect when the tenant vacates. If the tenant chooses not to receive short-term relocation payments, the tenant shall not be obligated to pay any rent until the tenant reoccupies the rental unit.

2. Should a tenant be displaced for a greater time than stated in the landlord’s written notice to the tenant, the landlord shall pay additional short-term relocation expenses for each additional day of displacement, to be paid weekly in advance.

3. The landlord shall pay the tenant the following for each day of displacement:
27 a. Hotel or motel accommodations: $150.00 per household; b. Meal expenses: $30.00 per occupant.

The dollar amounts specified in this Subsection shall adjust annually at the rate of increase in the consumer price index. The Program Administrator shall publish the new short-term relocation payment amounts each year.

4. Nothing in this Section shall prevent a tenant from seeking a reasonable accommodation for disability from a landlord or impact a tenant’s legal right to disability accommodations during renovations.

5. The capital improvement plan may allow for the temporary disruption of major systems during the hours from 8:00 a.m. to 5:00 p.m., Monday through Friday, without requiring the relocation of tenants.

6. A capital improvement plan may not be approved if it would allow tenants to be exposed at any time to toxic or hazardous materials, including, but not limited to, leadbased paint and asbestos.

E. The Program Administrator shall approve, conditionally approve, or disapprove a proposed capital improvement plan within 15 days of the submission of a complete application. The Program Administrator shall provide landlords with written statement of deficiencies when a capital improvement plan is determined to be inadequate. A landlord may submit an amended plan to correct deficiencies.

F. Once the Program Administrator has approved a landlord’s proposed capital improvement plan, the landlord must provide affected tenants a copy of the approved capital improvement plan along with a notice, as provided by the Program Administrator, of the tenant’s right to appeal the capital improvement plan pursuant to Subsection H.

G. Landlords and tenants may appeal the Program Administrator’s determination regarding a capital improvement plan. The appeal shall be made in writing, upon appropriate forms provided by the Program Administrator, and shall specify the grounds for appeal, such as the plan being overly disruptive or that a temporary relocation should or should not be provided. The appeal shall be filed within 15 days of the service of the Program 28 Administrator's determination. A hearing officer shall hear the appeal within 30 days of the filing of the appeal according to Section 26.90.080. The hearing officer shall issue a written decision within 15 days of the hearing, with a copy of the decision served on the landlord and the tenants by first class mail, postage prepaid, or in person. Tenants may raise on appeal that job or childcare schedules or other unavoidable hardship require relocation or other mitigation measures beyond those proposed by the landlord, in addition to the other requirements of this Section.

H. A capital improvement plan submitted as a prerequisite to the filing of a petition under Section 26.90.060 shall not be approved or conditionally approved unless the proposed improvements are reasonable, for the benefit of the tenants, and are of the type listed in Section 26.90.060 B.

I. The Program Administrator may issue regulations consistent with this Section regarding procedures and requirements for capital improvement plans, subject to approval by or at the direction of the Rent Stabilization Board.

26.90.110 Notices.

A. In addition to any other notice required to be given by law, including this Chapter, and concurrently with the offer of a lease required under Section 26.40.010 of this Code, a landlord shall provide to a prospective tenant of a covered rental unit all of the following:

1. A written notice that the rental unit is subject to this Chapter.

2. A current copy of this Chapter.

3. A current copy of any City regulations promulgated to implement this Chapter.

4. A current copy of any brochure the Program Administrator issues to explain this Chapter.

B. A landlord may satisfy the requirements of Subsection A by providing to a prospective tenant a hard copy of the materials set forth in subsection A or if a prospective tenant has internet access and consents in writing, by providing the prospective tenant with a link to 29 the required information on a website established by the Program Administrator. A landlord shall document that the prospective tenant has been informed of the choices and of what choice the prospective tenant made including, where applicable, the prospective tenant's written consent to receive the materials online.

C. A landlord must retain proof of compliance with the notice requirements of this Section and Section 26.90.010 B (when applicable) for each covered unit and file a copy of the proof of compliance with the Program Administrator within three days of a written demand.

D. The term “prospective tenant” as used in Subsections A and B of this Section means any person entitled to the offer of a lease under Section 26.40.010, including an existing tenant.

E. Whenever this Chapter or applicable law requires that a landlord give notice to a tenant or prospective tenant, the notice shall be given in writing in English and Spanish or such other language as landlord knows or reasonably should know the at the tenant understands.

26.90.120 Remedies; Enforcement.

A. The violation of any provision of this Chapter is a punishable offense as provided in Chapter 1.28 of this Code.

B. The City Attorney is authorized to enforce this Chapter through civil or criminal action. The City Attorney is further authorized to bring actions for injunctive relief on behalf of the City. The City Attorney shall seek recovery of costs, expenses, and attorney's fees as allowed by law.

C. Any aggrieved person may bring a civil action for damages for any violation of this Chapter or the final orders and decisions of a hearing officer or Rent Stabilization Board. The burden of proof in such cases shall be by a preponderance of the evidence.

D. A court of competent jurisdiction may enjoin any person who commits an act, proposes to commit an act, or engages in any pattern and practice that violates this Chapter. 30 An injunction action under this Section may be sought by any aggrieved person, including the City.

E. A landlord's failure to comply with any requirement of this Chapter may be asserted as a complete affirmative defense in an unlawful detainer or any other action brought by the landlord to recover rent or possession of a covered rental unit. Additionally, any attempt to recover possession of a covered rental unit in violation of this Chapter shall render the landlord liable to the tenant for damages in a civil action for wrongful eviction. The prevailing party in an action for wrongful eviction shall recover costs and reasonable attorneys' fees.

F. The remedies provided in this Chapter are not exclusive, and nothing in this Section shall preclude any person from seeking any other remedies, penalties or procedures provided by law.

26.90.130 Hearing Officers
A. The City Administrator may retain hearing officers to conduct hearings under this Chapter using any or all of the following methods:

1. Hiring as a City employee.

2. Contracting with an active or retired attorneys, retired judges, or other judicial officers on an ad hoc basis for one or more matters or cases.

3. Contracting with a business entity that provides dispute resolution services B. A hearing officer, who is not a City employee, shall be an independent contractor. To avoid conflicts of interest, including the appearance of conflicts, a hearing officer shall provide no services to the City other than those of a hearing officer.

C. The City Administrator is authorized to execute service agreements as necessary to implement this Section and subject to approval of the form of the contract by the City Attorney. Hearing officers, except volunteer panel members, shall be compensated for their services on an hourly or flat rate basis, and all hearing officers will be reimbursed for their actual and necessary expenses, without regard to the outcome of any decision. 31 D. An employee appointed as a hearing officer shall not have a term of office but shall serve as an at-will employee of the City. An attorney contracted for an individual matter shall not have a term of office but shall serve as an independent contractor.

E. The appointment, selection, employment, continued employment, performance evaluation, compensation, and benefits of a hearing officer shall not be directly or indirectly conditioned upon the outcome of hearings conducted under this Chapter. [End New Language]
Section 2.

Title 26 of the Santa Barbara Municipal Code is amended by adding Chapter 26.100, which reads as follows:

CHAPTER 26.100 RESIDENTIAL RENTAL REGISTRY

26.100.010 Rental Registry.

A. The Program Administrator shall create a rental registry in a format determined by the Program Administrator. The Program Administrator shall make registrations, or registration forms, available to landlords through the Rent Stabilization Program website.

B. All residential rental units in the City shall be registered except rental units that are within an owner-occupied dwelling where the owner and tenants share common facilities such as kitchens or bathrooms.

C. Landlords shall register rental units as follows:

1. An initial registration form for each covered rental unit must be completed by the later of April 1, 2027, or within 30 days after the Program Administrator has made the registration form available.

2. An initial registration form for each rental unit that is not a covered rental unit under this Chapter must be completed by the later of October 1, 2027, or within 30 days after the Program Administrator has made the registration form available. 32 3. The Program Administrator shall establish by regulations or administrative procedures, annual registration deadlines, renewal procedures, and related administrative requirements. Landlords must register units according to the deadlines, procedures, and requirements established by the Program Administrator.

4. The landlord must pay the rental registry fee for each rental unit concurrently with the filing of the registration form and with each annual registration renewal. A registration form is not complete unless the rental registry fee for each covered unit is paid.

5. A landlord may submit a single form for all rental units on a property provided that the form contains all the required information for each unit and the rental registry fee for each covered unit is paid.

D. A new landlord must file an amendment to the registration or exemption form for each rental unit on a property within 30 days of an ownership change.

1. The amendment form must be accompanied by a copy of a written notification form prescribed by the Program Administrator and sent from the landlord to all tenants of each rental unit on an affected property;

2. The form should advise the tenants of the change in ownership and contain the name, address and contact information of the new landlord and of the new landlord's property manager or representative, if any.

3. The amendment form must also be accompanied by a declaration that the written notification was provided to tenants.

4. A landlord must also file a registration amendment within 30 days of a change of the property management or authorized agent or if the landlord’s or authorized agent’s address changes.

E. A landlord shall amend a registration for a rental unit with the City within 30 days after a rental unit is re-rented after a vacancy.

F. Rental registration shall completely and accurately provide the following information for each rental unit as of the filing date:

1. Address of each rental unit including identifying number or letter. 33 2. Number of bedrooms and bathrooms.

3. Name, current address, and contact information of landlord, authorized representatives and property managers.

4. Date of the landlord’s assumption of ownership.

5. Current rent.

6. Date and amount of last rent increase.

7. Move-in date of current tenant(s).

8. Whether the rental unit is exempt from the requirements of Chapter 26.90.

9. Additional information the Program Administrator may specify by regulation or administrative procedure.

G. All rental registration and exemption forms must include the landlord’s declaration under penalty of perjury that the information provided is true and correct.

H. Commencing January 1, 2028:

1. The City may commence enforcement against any landlord who fails to register a rental unit.

2. No landlord shall advertise for rent, demand or accept rent for a rental unit, or evict any tenant from a rental unit, if an accurate rental registration or exemption for that unit has not been completed or amended as required by this Section.

3. No rental adjustment under Section 26.90.040 no rental increase under Section 26.90.050 or 26.90.060, and no petition for a rent increase under Section 26.90.080 may take effect or be filed unless the landlord has complied with the registration requirements of this Section.

4. No landlord may commence a no-fault just cause eviction under Chapter 26.50 unless the landlord has complied with the registration requirements of this Section.

26.100.020 Rental Registry Fee.
34 A. A rental registry fee shall be paid by a landlord for each rental unit to fund the City's cost to administer and enforce this Chapter. The rental registry fee for each rental unit subject to Chapter 26.90 shall also include an amount to fund the City’s cost to implement, administer, monitor, support, and enforce the provisions of Chapter 26.90.

B. The amount of the rental registry fee shall be determined by resolution of the City Council adopted from time-to-time. Fees proceeds shall not exceed the amount the City Council determines to be necessary to administer and enforce this Chapter, plus an amount necessary to administer and enforce Chapter 26.90 for units subject to that Chapter. Revenue generated from fees shall not be used for any purpose other than costs of administration and enforcement of this Chapter, and Chapter 26.90 for units subject to that Chapter.

C. Late charges and penalties as determined from time-to-time by City Council resolution will be collected from landlords who fails to timely file a registration form or an amendment to a registration form when required by this Chapter. Any required but unpaid rental registry fees, late charges, or penalties imposed under this Section shall be deemed a debt to the City.

D. After timely payment of the rental registry fee, but not a late charge or penalty, the landlord may pass through up to 50% of the fee for a rental unit to the tenant of the applicable rental unit, to be paid by the tenant in 12 equal monthly installments. If a portion of the fee is pass-through to tenants, the amount must be separately itemized and shall not be considered part of the rent in calculating any rent Increase. Any pass-through unpaid by a tenant upon termination of a tenancy shall not assessed to the tenant. No portion of the registration fee may be passed through to tenants who reside in housing restricted by a deed, regulatory restriction contained in an agreement with a government agency, or by any other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code, or by an agreement that provides housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.

26.100.030 Definitions.
35 The definitions in Section 26.90.020 of this Code apply to this Chapter.

Section 3.

If any Section, subsection, subdivision, paragraph, sentence, clause or phrase of this Chapter or any part hereof is for any reason held to be unconstitutional or otherwise unenforceable, such decision shall not affect the validity of the remaining portions of this Chapter. The City Council declares that it would have passed each Section, subsection, paragraph, sentence, clause or phrase hereof, irrespective of the fact that any one or more Sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases be declared unconstitutional or otherwise unenforceable and, to that end, the provisions of this Ordinance are hereby declared to be severable.

Section 4.

The City Council finds that, on the basis of the whole record and by exercising its independent judgment, this Ordinance is not subject to environmental review pursuant to the State Guidelines for Implementation of the California Environmental Quality Act Sections 15060(c)(3) pertaining to activities that will not result in a direct or reasonably foreseeable indirect change to the environment and Section 15061 (b)(3) because this Ordinance has no potential for resulting in physical change to the environment directly or indirectly as it merely regulates existing physical development.

CITY OF SANTA BARBARA
Council Agenda Report
Agenda Date: October 6, 2026
To: Mayor and Councilmembers
From: City Administrator’s Office
Subject: Authorize the City Administrator to Execute a Local Housing Trust Fund Loan for the Acquisition of Land by People’s Self-Help Housing Related to the Carrillo Street Apartments Project [Ordinance Introduction; Resolution; Agreement]
Recommendation:

That Council:

A. Authorize the City Administrator to execute a Local Housing Trust Fund Loan Agreement for a term of 55 years for the acquisition of land with People’s Self-Help Housing; B. Introduce and subsequently adopt, by reading of title only, an Ordinance of the Council of the City of Santa Barbara Approving a Loan Agreement with People’s Self-Help Housing in the Amount of $1,945,176 for Land Acquisition of the Real Property Located at 312 W Carrillo Street, 316 W Carrillo Street, and 1018 Placido Avenue, to be Used for Permanent Affordable Housing, to be Secured by a Deed of Trust and a 55-Year Affordability Control Covenant Imposed on Real Property, and Authorizing the City Administrator to Execute such Agreements, Subject to Approval as to Form by the City Attorney; C. Adopt, by reading of title only, a Resolution of the Council of the City of Santa Barbara Amending Resolution No. 26-057, Adopting the Budget for Fiscal Year 2027, to Approve an Increase in Expenditure Appropriations in the Local Housing Trust Fund in the Amount of $1,945,176, to Fund a Loan Agreement with People’s Self Help Housing for the Acquisition of Property for Affordable Housing Development at 312 W Carrillo Street, 316 W Carrillo Street, and 1018 Placido Avenue; and
D. Read the titles of the Ordinances and Resolutions and, if there is no objection from any Councilmember present, waive further reading pursuant to Section 511 of the Santa Barbara City Charter.

Agenda Item No. 6
Council Agenda Report
Authorize the City Administrator to Execute a Local Housing Trust Fund Loan for the Acquisition of Land by People’s Self-Help Housing Related to the Carrillo Street Apartments Project [Ordinance Introduction; Resolution; Agreement]

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Santa Barbara City CouncilOctober 6, 2026

Santa Barbara City Council
October 6, 2026