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agenda-report Introduction and First Reading of Ordinance to Amend the Text of the City's Ordinance Related to Economic Recovery in (1) the City's Downtown, Mixed Use and Commercial, Employment, Oceanfront, and Public and Semi-Public Districts, Excluding the Area Including and Immediately Adjacent to the Third Street Promenade; and (2) the Area Including and Immediately Adjacent to the Third Street Promenade

Santa Monica City Council
October 11, 2022

Document
agenda-report Introduction and First Reading of Ordinance to Amend the Text of the City's Ordinance Related to Economic Recovery in (1) the City's Downtown, Mixed Use and Commercial, Employment, Oceanfront, and Public and Semi-Public Districts, Excluding the Area Including and Immediately Adjacent to the Third Street Promenade; and (2) the Area Including and Immediately Adjacent to the Third Street Promenade
Meeting
October 11, 2022
Body
Santa Monica City Council
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Text extracted from the city's file for reading and search. Open the original on santamonicacityca.iqm2.com. That file is the official record.

City Council
Report
City Council Meeting: October 11, 2022
Agenda Item: 10.D
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To: Mayor and City Council
From: David Martin, Director, Administration
Subject: Introduction and First Reading of Ordinance to Amend the Text of the City's Ordinance Related to Economic Recovery in (1) the City's Downtown, Mixed Use and Commercial, Employment, Oceanfront, and Public and Semi-Public Districts, Excluding the Area Including and Immediately Adjacent to the Third Street Promenade; and (2) the Area Including and Immediately Adjacent to the Third Street Promenade
Recommended Action
Staff recommends that the City Council introduce for first reading an ordinance related to economic recovery efforts in:

1. City’s Downtown, Mixed-Use and Commercial, Employment, Oceanfront and Public and Semi-Public Districts, excluding the Third Street Promenade and the area immediately adjacent thereto; and

2. The area including the Third Street Promenade and immediately adjacent thereto, bounded by 2nd Street to the west, Broadway to the south, 4th Street to the east, and Wilshire Boulevard to the north.

Summary
In response to the COVID-19 Pandemic, the City established a variety of zoning changes adopting two emergency Interim Zoning Ordinances (IZO) establishing interim zoning regulations to support the economic recovery of local businesses impacted by the COVID-19 pandemic; 1) zoning changes applicable to commercial districts citywide and; 2) zoning changes specific to the Third Street Promenade and area immediately adjacent thereto (the “Third Street Promenade Area”).
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Both emergency IZOs have focused on relaxing land use barriers that had been shown to create unnecessarily difficult review processes for simple changes of use often inhibiting or delaying the establishment of common neighborhood-serving uses. Since adopted, the interim zoning changes have provided needed support to existing and new restaurant, retail, personal service, and fitness-related businesses, critical to the City’s economy. DTSM and the business community are in support of these zoning changes and believe that permanently adopting these changes are critical in providing greater certainty and predictability for property owners and their existing tenants, along with perspective businesses considering Santa Monica locations.

Both the Citywide and the Promenade IZO’s are set to expire on December 31, 2022, unless further extended or permanently adopted. In its review, staff recommends that the City Council focus on the following:

1. Whether the interim zoning changes Citywide and specific to the Third Street Promenade Area, including the Planning Commission’s recommended revisions to the existing interim provisions, are appropriate in providing the necessary continued economic support to existing Santa Monica businesses and new businesses seeking opportunity to contribute to the City’s overall economy.

Staff recommends permanent adoption of the Citywide and Promenade IZO’s, in addition to the Planning Commission’s recommended changes, as outlined and based on the findings provided in this report.

Background
Past Council Actions
Meeting Date Description
May 12, 2020 Council adopted two Emergency Interim Zoning Ordinances establishing interim zoning regulations to support the
economic recovery of local businesses impacted by the
COVID-19 pandemic.

November 10, 2020 Extended Emergency Interim Zoning Ordinances for both 3 of 18
Citywide and Promenade, extended through December 31,
2022.

April 13, 2021 (“IZO
2667”), September 28,
2021 (“IZO 2682”), and
January 25, 2022 (“IZO
2690”)
Subsequent amendments to the “Promenade” IZO.

On April 20, 2022, the Planning Commission adopted resolution number 22-008 (PCS) and resolution number 22-009 (PCS) declaring its intention to recommend that the City Council amend the text of the Zoning Ordinance related to economic recovery.

On August 17, 2022, the Planning Commission adopted resolution number 22-013 (PCS) recommending that the City Council amend the text of the Zoning Ordinance related to economic recovery in the City’s Downtown, Mixed-Use and Commercial, Employment, Oceanfront, and Public and Semi-Public Districts (Citywide), excluding the area including and immediately adjacent to the Third Street Promenade. The Commission also adopted resolution number 22-014 (PCS) recommending that the City Council amend the text of the Zoning Ordinance related to economic recovery of the BC (Promenade) District and those portions of the BC (2nd and 4th Street) District bounded by Second Street to the west, Broadway to the south, 4th Street to the east, and Wilshire Boulevard to the north (collectively the “Third Street Promenade Area”). The Commission supported permanent adoption of both Emergency Interim Zoning Ordinances recognizing the need for continued economic support through land use policy, and provided clarifying language and two recommended revisions for the Council’s consideration:

1. Expand the allowance of alternative loading plans currently limited to the Third Street Promenade Area to the entire Downtown Community Plan area; and

2. Expand the area where open-air rooftop commercial uses are excluded as floor area/FAR from directly on the Promenade to the defined Third Street Promenade Area, resulting in a half-block radius expansion.

Discussion
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Below is a summary of the Citywide and Third Street Promenade Area interim zoning regulations.

Citywide Interim Zoning Regulations: All Commercial Districts Excluding the Third Street Promenade Area
Ordinance Number 2637 established interim zoning regulations applicable to the City’s Downtown, Mixed Use and Commercial, Employment, Oceanfront, and Public and Semi-Public districts excluding the Third Street Promenade Area (also known as the Citywide Economic Recovery Area). The adopted changes included the following:

Interim Land Uses:

1. Restaurants Up to 5,000 SF - Permitted Use: Eliminated discretionary permits for restaurants up to 5,000 square feet in size. Whereas full service and limited service/take out restaurants of up to 5,000 square feet would typically require approval of a Minor Use Permit, the IZO allows such restaurants to be permitted by-right. This change provides a streamlined review and allows greater flexibility for restaurant reopening.

2. Food Halls Up to 175 Seats - Conditional Use: Food Halls with up to 175 seats shall be a conditionally permitted use in the Citywide Economic Recovery Area.

3. Limitation on Restaurant Uses on Main Street – Table 9.11.020: Removed restrictions on Main Street restaurants. Per the IZO, land use limitation (11) for restaurant uses on Main Street in the Neighborhood Commercial District does not apply to permitted restaurants up to 5,000 SF. Limitation 11 includes the following restrictions:
▪ Limits the number of restaurants (2) of greater than 2,500 SF per block; ▪ Limits restaurants north of Ocean Park Blvd to one per block on east side of street, and further limits the number of seats to 200 per block and 400 in Block 6;
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▪ Limits on-sale alcohol permits (12) north of Ocean Park Blvd, and further limits on-sale general permits;
▪ Limits the number of bars to a total of six (6) along Main Street; Per the IZO, limitation 11 would only apply to restaurants greater than 5,000 SF. For example, only restaurants greater than 5,000 SF would be limited to two (2) per block.

In addition, staff recommends eliminating the seat number restriction for restaurants north of Ocean Park Blvd which states no more than 200 seats per each block, and no more than 400 seats in Block 6 (OP Blvd to Hollister Ave). The restrictions on the number of alcohol permits should also be removed. Also, the cap on the number of bars along Main Street should be eliminated for clarifying reasons since bars are currently not allowed in the NC district. Limiting the number of restaurant seats and alcohol permits in this manner is contrary to the City’s economic recovery efforts in simplifying standards that support business reopening.

4. Limitation on Size and Street Frontage of Tenant Spaces - Table 9.11.020 Limitations (2), (17), (19): Clarified the applicability of storefront width and tenant space size restrictions on existing tenant spaces to only new construction and alterations to existing buildings that result in a combination or enlargement of tenant spaces. This change clarifies and allows existing vacant tenant spaces considered abandoned for more than 1 year to be reoccupied without a Conditional Use Permit.

5. 9.27.050(B) Abandonment of Legal Non-Conforming Eating and Drinking Establishments and Retail Uses: Eased standards related to when retail and restaurant uses are considered abandoned. Based on the existing requirements, existing nonconforming uses that cease business operations for a continuous period of more than 1 year are considered abandoned and any new business thereafter would be subject to obtaining any current planning entitlements and comply with current parking requirements. In efforts to encourage and support the continuation of restaurant and retail businesses at the same location postpandemic, the IZO eliminates the 1-year time period and allows for these types of 6 of 18
land uses to reoccupy vacant tenant spaces previously used for such uses without losing any legal non-conforming rights to that use, no matter how long the vacancy provided that no other use has occupied the vacant space since the restaurant or retail use was abandoned. This eliminates the need for new businesses seeking to occupy vacant spaces to obtain any land-use entitlements and satisfy any new parking requirements.

6. 9.28.020(B)(2) Relaxed Parking Requirements for Changes of Use: Per the IZO, changes in use that create an increase of 10 or fewer additional parking spaces required (changed from 3 spaces per the current Code) compared to the prior use (or general parking rate of 1/300) shall not be required to provide additional on-site parking. This change improves the ability for new businesses to occupy vacant tenant spaces that have a slightly higher parking requirement than the prior use or 1/300 parking rate without needing to provide additional parking for the new use. Restaurants are provided with additional flexibility when determining the additional parking where only the dining area, excluding any square footage dedicated to back-of-house and outdoor dining areas, is included in the calculation.

7. 9.28.060 Offsite Parking Requirements for Food Halls: Establishes parking requirements for Food Halls citywide ranging from 1/300 to 1/500.

8. 9.28.080 Relaxed Loading Requirements for Changes of Use: Whereas currently a Parking and Loading Operations Plan (PLOP) is required for any change of use, this IZO change allows for changes of use of up to 5,000 SF to be flexible where staff may approve an alternate loading plan that may include a waiver or reduction in number of dimensions of loading areas depending on the project and existing site conditions. This change simplifies the change of use review procedures and results in a more collaborative review to address loading needs based on existing site conditions.
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9. Alcohol Exemptions (AE) for Citywide Economic Recovery Area (Excluding Santa Monica Pier: The Alcohol Exemption Permit allows restaurants to serve alcoholic beverages and is an alternative permit to the discretionary alcohol Conditional Use Permit. The review procedure for an Alcohol Exemption is ministerial where a permit is automatically granted to a restaurant provided they agree to operate according to an established set of operational conditions (e.g. hours of operations, etc.). The existing Alcohol Exemption operational conditions and review procedures were modified to provide improved flexibility in operations for restaurant establishments (full service and limited service/take out) and a more streamlined review process.

9.31.040(D)(1) Criteria & Conditions: The following conditions were removed to provide flexibility in business operations or correct inconsistencies throughout section:
▪ The primary use of the premises shall be for sit-down meal service to patrons (for consistency based on restaurant types);
▪ Take out service shall be only incidental to the primary sit-down use (for consistency based on restaurant types);
▪ Except for special events, alcohol shall not be served in any disposable containers such as disposable plastic or paper cups (unnecessary); ▪ No more than 3 television screens including video projectors or similar audio/visual devices shall be utilized on the premises. None of these televisions or projection surfaces shall exceed 60 inches measured diagonally (for flexibility);
▪ No more than 35 percent of total gross revenues per year shall be from alcohol sales (for flexibility).

The following permitted hours of operation were expanded to provide added business flexibility:
▪ Open/Closure hours expanded from 9am-11am (Sun-Thurs) and 9am12am (Fri-Sun) to 9am-12am (all days), with closure and employees 8 of 18
vacated by 1am (all days), and alcohol removed from any outdoor dining area no later than 11am (Sun-Thurs only).

Alcohol Exemption Permit Processing: For restaurants over 50 seats, notification to owners/tenants within a 750-foot radius of the site remains, however the appeal process has been eliminated to assist with application streamlining and faster restaurant reopening. Furthermore, this change corrects the review process to be consistent with the purpose of a ministerial review which should not involve discretion through an appeal procedure.

10.Alcohol Exemptions (AE) for Santa Monica Pier: AE criteria and conditions were established specifically for the Santa Monica Pier and include slight differences compared to the Citywide criteria and conditions. Considering the types of businesses occupying the Pier and its focus as a commercial/visitor destination, the land uses for which an AE can be applied for was expanded to include bars/nightclubs/lounges, food halls, and general retail sales (small and large scale) with expanded operating hours of 8am-2am daily.

Interim Use Classifications:

11.9.51.030(B)(7)(e) Small-Scale Facility: Removes health clubs and yoga studios from this definition and relocates these uses to Personal Services, Physical Training up to 5,000 SF in size. This change provides greater flexibility for fitness uses that were in high demand during the Pandemic.

12.Food Hall: The IZO added a Food Hall definition to the Commercial Use Classifications. Although a food hall has not been established during the Pandemic, the City has received interest in food hall concepts in the past and therefore the IZO established a land use definition with review procedures and parking requirements.

13.9.51.030(B)(21)(b) Personal Services, Physical Training: Revision expands size restriction of such uses from classes and groups of 5 or less persons to 9 of 18
tenant spaces up to 5,000 SF in size. Fitness and yoga studios added to this definition. This change provides greater flexibility for fitness uses that were in high demand during the Pandemic.

These interim changes focus on removing barriers related to the approval of restaurants, physical training, and changes of uses by simplifying certain standards and streamlining review procedures. Alcohol exemption conditions were simplified and appeal procedures for restaurants over 50 seats eliminated to help streamline and support food-serving establishments, and to provide consistency in its ministerial review process. The elimination of the restaurant restrictions on Main Street continues to provide greater flexibility and encourages adaptive reuse of existing/vacant tenant spaces within the Main Street Neighborhood Commercial district. Restrictions on the overall size and storefront width of tenant spaces have been simplified, size limitations on physical training are less restrictive, and changes of use are supported with up to a 10-parking space credit to allow flexibility for a broad range of new businesses. These changes have greatly supported existing and the establishment of new commercial uses while balancing the loss of businesses during the Pandemic.

As the City continues to provide support to local businesses and promote business opportunities citywide, these interim zoning provisions have shown to be successful in the City’s overall economic recovery efforts. Therefore, staff recommends these zoning changes, including the additional modifications outlined, for permanent adoption as part of the City’s overall evaluation of the temporary changes authorized through emergency orders and IZOs during the Pandemic.

Interim Zoning Regulations– Third Street Promenade Area Downtown Santa Monica has long been a community gathering place and economic stronghold. Supported by DTSM’s leadership, Downtown and the Third Street Promenade continue to evolve, changing with the needs of retailers, property owners, visitors, and the Santa Monica community. With the onset of the COVID-19 pandemic and subsequent economic recovery, DTSM initiated the Promenade Vitality Plan in January 2021. The Plan was discussed at a Study Session with Council on February 9, 10 of 18
2021. This effort is separate from the Promenade 3.0 planning effort which focused on the redevelopment of the Promenade streetscape; that effort has been put on hold due to the City’s 2020 restructuring. Research conducted as part of Promenade 3.0 was used in the development of the Promenade Vitality Plan.

To further preserve and enhance the economic vitality of the Promenade, DTSM enlisted the firm MIG and engaged in a series of conversations, workshops, interviews, and surveys with business and property owners, brokers, residents, advocates, elected and appointed officials, industry experts, and others. Interim changes to the Promenade to date have been based on this feedback, staff recommendations, and both Commission and Council direction.

As stated, there have been multiple IZO revisions made to the Third Street Promenade Area during the Pandemic, with the intent to streamline processes by introducing simple land use changes to common neighborhood-serving uses and remove barriers to opening a business.

The most recent IZO 2690 adopted on January 25, 2022 is inclusive of all economic recovery amendments for the Promenade area to date and include the following:

1. Added new land uses to the table of permissible uses for all three blocks of the Promenade, including (as noted below) those appropriate for Promenade facades and those appropriate for alley facades and upper floors. Streamline permitting of existing land uses by minimizing applicability of Conditional Use Permits (CUPs), Minor Use Permits (MUPs), and other discretionary approvals.

Revisions to ensure consistency with other requirements were also made:
▪ Group Residential, Congregate Housing, Senior Group Residential – allow on upper floors without requiring an MUP;
▪ Child Care & Early Education Facilities – allow on ground floor with Promenade frontage;
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▪ Community Assembly – allow on ground floor along alley frontage or on upper floors;
▪ Grooming and Pet Stores and Veterinary Services – allow on ground floor with Promenade frontage with no size restrictions/CUP requirement; ▪ Business Services – allow on ground floor along alley frontage or on upper floors;
▪ Cinemas & Theaters, more than 99 seats – allow without requiring CUP; ▪ Convention and Conference Centers – allow without requiring CUP; ▪ General Retail Sales, Medium-Scale Facility – allow without requiring CUP; ▪ Liquor Stores – allow with Promenade frontage without requiring a CUP; ▪ Bed and Breakfast – allow without requiring MUP;
▪ Hotels and Motels – allow without requiring CUP;
▪ Medical & Dental Offices – allow on ground floor with Promenade frontage and not limited to upper floors or on ground floor 25 feet from sidewalk; ▪ General Personal Services – allow on ground floor with Promenade frontage with no size restrictions/CUP requirement;
▪ Tattoo or Body Modification Parlor – allow without requiring MUP; ▪ Food Hall,, Fortunetelling, added as permitted uses;
▪ Industry, Limited - added as a permitted use, with limitations on location and restrictions on the types of allowable industries within the use classification. ▪ ADUs, and JADUs added as permitted uses;
▪ Physical Training – clarification for consistency that removes location limitations, allows on ground floor not exceeding 100 feet of frontage without a CUP;
▪ Large Scale Facilities – correction to limitation related to Large Scale Facilities in that they are permitted, however a fitness center use exceeding 100 linear feet of ground floor frontage would require approval of a CUP; 12 of 18
▪ Automobile & Vehicle Showroom Specific Limitation – revised to include all fuel types as a permitted use, which may display up to one alternative fuel vehicle if such is available in the dealer’s fleet and limited to up to six showrooms.

2. Reduce Minimum Active Ground Floor Depth: Table 9.10.040 Limitation L(1): Reduces the ground floor minimum depth requirement for active commercial uses from 50 feet to 25 feet measured from Promenade property line. This change provides added flexibility in creating multiple tenant spaces or smaller tenant spaces depending on market demand.

3. Allow Entry/Direct Access to Upper Floors and Rear Office Uses from the Promenade: Table 9.10.040 Limitation L(1): Revised language where ground floor entries are no longer specifically identified as a portion of the entire tenant space that must be located 25 feet from the Promenade, thereby allowing entries to these tenant spaces to have some presence on the Promenade and provide accessibility from the sidewalk. This change, in conjunction with the reduction in active ground floor depth (above) provides flexibility in creating multiple desirable tenant spaces on all floors.

4. Limited-Service and Take-Out Restaurant Establishments with Frontage on the Promenade and Specific Characteristics Prohibited – Table 9.10.040 (Limitation L 22): City Council voted to make this provision permanent on January 26, 2021 (Ordinance No. 2661). This provision was added to the IZO for consistency and therefore no further action is necessary to codify this provision. This provision is included in this report to provide transparency and a reminder of what the Council had previously adopted.

5. 9.10.040(A) Conversion of Any Portion of an Eating and Drinking Establishment to Any Other New or Expanded Use Located on the Ground Floor: Eliminated the requirement of a Conditional Use Permit for the conversion 13 of 18
of eating and drinking establishments to other uses, applicable to the Third Street Promenade Area. This change provides flexibility and streamlined review for changes in use pertaining to existing eating and drinking establishments, and removes restrictions on leasing these spaces.

6. 9.27.050(B) Abandonment of Legal Non-Conforming Eating and Drinking Establishments and Retail Uses: Eased standards related to when bars/nightclubs, restaurants, food hall, general retail sales (small and medium) uses are considered abandoned. Based on the existing requirements, existing nonconforming uses that cease business operations for a continuous period of more than 1 year are considered abandoned and any new business thereafter would be subject to obtaining any current planning entitlements and comply with current parking requirements. In efforts to encourage and support the continuation of these types of businesses at the same location post-pandemic, the IZO eliminates the 1-year time period and allows for these types of land uses to reoccupy vacant tenant spaces previously used for such uses without losing any legal non-conforming rights to that use, no matter how long the vacancy, provided that no other use has occupied the vacant space since the restaurant or retail use was abandoned. This eliminates the need for new businesses seeking to occupy vacant spaces to obtain any land-use entitlements.

7. 9.28.080 Relaxed Loading Requirements for New Buildings, Additions, Enlargements of Use, and Changes of Use: Currently limited to the Third Street Promenade Area, staff may approve an alternate loading plan that may include a waiver or reduction in number of dimensions of loading areas depending on the project and existing site conditions. Different from the Citywide loading provision which is limited to changes of use up to 5,000 SF, this also applies to new buildings, additions, and enlargements of use. This change simplifies loading review procedures and results in a more collaborative review to address loading needs. This provision has shown to be effective during the Pandemic. Therefore, staff recommends expanding its applicability to the overall Downtown Community Plan area, excluding the Ocean Transition (OT) District 14 of 18
(along Ocean Avenue in the Downtown) based on the limited space on existing properties where creative solutions are often necessary. The Planning Commission in its review, was supportive of the expansion to include the entire Downtown Community Plan area. Subsequent to the Commission meeting, staff determined that it would be more appropriate to exclude properties along Ocean Avenue to discourage further use and consideration of Ocean Avenue for loading purposes, and therefore revised language is reflected in the attached resolution.

8. Alcohol Exemptions (AE) for Third Street Promenade Area: The Alcohol Exemption Permit allows restaurants to serve alcoholic beverages and is an alternative permit to the discretionary alcohol Conditional Use Permit. As discussed, the review procedure for an Alcohol Exemption is ministerial where a permit is automatically granted to a restaurant provided they agree to operate according to an established set of operational conditions. The existing alcohol exemption operational conditions and review procedures were modified to provide improved flexibility in operations for restaurant establishments (full service and limited service/take out), bars/nightclubs, food halls, and general retail sales (small and medium scale) for establishments within the Third Street Promenade Area and a more streamlined review process. The changes to the conditions are similar to the revisions proposed Citywide, except bars/nightclubs, food halls, and general retail sales were added as applicable uses, and operational hours were expanded with slightly earlier and later hours appropriate for the Promenade activity.

Alcohol Exemption Permit Processing: For restaurants over 50 seats, notification to owners/tenants within a 750-foot radius of the site remains, however the appeal process has been eliminated to assist with application streamlining and faster restaurant reopening. Furthermore, this change corrects the review process to be consistent with the purpose of a ministerial review which should not involve discretion through an appeal procedure.
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9. Zoning Conformance Review for Existing Alcohol Outlets: For existing alcohol outlets located within the Third Street Promenade Area and without a alcohol CUP that changes ownership or proposes an interior remodel, a zoning conformance review is no longer required provided the business has remained in continuous use without substantial change in mode or character of operation.

This change establishes fewer criteria when determining substantial change in mode or character and therefore streamlines the review procedures.

10.FAR Calculation for Open-Air Rooftop Commercial Uses: 9.04.080, 9.04.090 (A)(2): Exempts unenclosed rooftop areas used for commercial or restaurant activity from floor area and floor area ratio, specifically for the BC (Promenade) district. Allows rooftop shading devices up to 10 feet in height above the roofline with aggregate coverage up to 50%. This change supports the use of outdoor space on building rooftops and encourages the use of outdoor space consistent with the City’s outdoor space program efforts. Currently, the IZO limits this provision to the Promenade, however staff and the Planning Commission recommend expanding the allowance to include the defined Third Street Promenade Area, which results in an expansion of a half-block radius.

These interim changes to the Third Street Promenade Area reflect short and mediumterm policy and procedural changes specific to the evolving economic vitality of the Promenade area. Simple changes have broadened the range of permitted uses with fewer restrictions that would be considered appropriate for permanent adoption, while other short-term policy changes may require further evaluation over time. Such changes include the prohibition of certain fast-food establishments and the expansion of automobile/vehicle showrooms to all fuel types (more recently adopted in January 2022). In coordination with DTSM and the City’s Economic Development staff, continued evaluation of zoning standards for Promenade area is ongoing. In the meantime, permanent adoption of the Promenade IZO provisions, including the proposed added modifications, would continue to support existing and new businesses as the Third Street Promenade Area recovers post-pandemic. Furthermore, permanent adoption would be critical in providing greater certainty and predictability for property 16 of 18
owners and their existing tenants, along with perspective businesses considering Santa Monica locations, particularly in the downtown area.

Planning Commission Recommendation
On August 17, 2022, the Planning Commission held a discussion and recommended the City Council adopt the proposed zoning amendments contained in both the Citywide and Third Street Promenade Area Interim Zoning Ordinances as drafted in the proposed resolutions, with a few additional changes in support of staff’s recommendations to:

1. Expand the allowance of alternative loading plans currently limited to the Third Street Promenade Area to the entire Downtown Community Plan (DCP) area. As discussed, staff’s original recommendation to the Planning Commission is revised to expand to the entire DCP area, excluding properties within the Ocean Transition (OT) District within the Downtown area.

2. Expand the area where open-air rooftop commercial uses are excluded as floor area/FAR from directly on the Promenade to the defined Third Street Promenade Area, resulting in a half-block radius expansion.

Additionally, the Commission identified a clerical typo in the draft language related to the Personal Services, Physical Training definition which has been corrected and is reflected in the proposed Ordinance.

Environmental Analysis
The proposed amendments to the Citywide Economic Recovery Area and Third Street Promenade Area consisting of land use and processing changes supporting economic recovery are categorically exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the State Implementation Guidelines. Based on the evidence in the record, it can be seen with certainty that there is no possibility that the proposed changes will have a significant effect on the environment. The recommended amendments represent land use and procedural changes do not substantively affect policy decisions made with the City Council’s adoption of the DCP and Zoning Ordinance, and is consistent with the City’s economic 17 of 18
recovery efforts during the Pandemic. Therefore, no further environmental review under CEQA is required.

Text Amendment Findings

1. The proposed amendments to the text of the Zoning Ordinance are consistent with the General Plan in that the amendments implement the LUCE policies to adapt to changing conditions and to support small businesses. Specifically, Goal LU9 states to actively monitor and manage land use changes to address community needs, promote citywide sustainability and ensure community livability. In response to the Pandemic, the City’s economic recovery efforts seek to support and allow businesses to adapt to the current health and safety conditions. The proposed Zoning amendments support local business retention and promotes new business opportunities citywide, addressing needs of the business community and residents. In addition, Policy LU13.4 seeks to reduce regulatory costs on small businesses and for the City to continue exploring ways to streamline the approval process for new and existing businesses. Accordingly, the proposed amendments support small businesses by simplifying land use standards and streamlining review procedures.

The proposed amendments are consistent with the Downtown Community Plan Goal LU3 which states that the Downtown continues to be the economic center for the City, providing a diverse and flexible mix of uses that can meet future resident, business, and visitor demand in that the proposed land use changes include simplified land use standards and streamlined review procedures to encourage and incentivize business reopening in the Third Street Promenade Area.

2. The proposed amendments to the text of the Zoning Ordinance are consistent with the purpose of the Zoning Ordinance to promote the growth of the City in an orderly manner and to promote and protect the public health, safety, and general welfare in that proposed amendments will provide continued support necessary for the City’s business retention and economic recovery efforts following the current Pandemic.
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Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action.

Prepared By: Steve Mizokami, Senior Planner
Approved Forwarded to Council
Attachments:

A. CDD-Ord-Economic Recovery 101122
B. Written Comments
C. PowerPoint Presentation

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