City Council
Report
City Council Meeting: April 23, 2024
Agenda Item: 10.B
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To: Mayor and City Council
From: David Martin, Director, City Planning
Subject: Introduction and First Reading of an Ordinance Amending the Text of the City's Zoning Ordinance to Update Provisions Related to State Density Bonus Law for Consistency with Recent Amendments to State law Adopted by AB 1287 and Making Other Minor Changes, Corrections, and Clarifications Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines.
2. Introduce for First Reading of an Ordinance amending the text of the Zoning Ordinance to update provisions related to the implementation of State Density Bonus Law for consistency with recent amendments to State Law adopted by AB 1287 and make other minor changes, corrections, and clarifications.
3. Provide direction regarding the Planning Commission’s recommendation regarding a potential local density bonus program for projects that provide off-site affordable housing.
Summary
On October 11, 2023, Governor Newsom signed Assembly Bill (AB) 1287 into law, which became effective on January 1, 2024. AB 1287 is an evolution of State Density Bonus Law that would allow qualifying housing development projects to seek up to a 100% density bonus for providing additional on-site affordable housing units for very low and moderate-income households.
The proposed ordinance amends the City’s density bonus ordinance (SMMC Chapter
9.22) for consistency with AB 1287. It should be noted that even if the City does not 2 of 6
have an updated density bonus ordinance, the City is still required to implement AB 1287.
Council is also being asked to provide direction regarding the Planning Commission’s recommendation for Council to direct the City Manager to study the creation of a local density bonus program when a market-rate housing project provides off-site affordable housing units.
Discussion
On March 20, 2024, the Planning Commission conducted a duly-noticed public hearing and, after considering all oral and written testimony, voted 6-1 to recommend that the City Council approve the proposed ordinance with the condition that the Council also consider the Commission’s further recommendation that Council direct the City Manager to study the creation of a local density bonus program for off-site affordable housing units. The Planning Commission has prepared a letter explaining its recommendation, which includes some reasoning as to why the City may want to ensure that the off-site option is equally attractive to the on-site option (see Attachment C).
The Commission’s interest in Council’s consideration is due to concerns that the additional density bonus allowed by AB 1287 disincentivizes the off-site affordable housing option in the Affordable Housing Production Program (SMMC Chapter 9.64).
State density bonus law only provides density bonuses when a project provides on-site affordable housing units. There is no State density bonus provided for projects that provide off-site affordable housing units. However, it does not preclude the City from creating its own local density bonus program to support the production of affordable housing units off-site.
Overview of AB1287
The additional density bonus provided to applicable projects in addition to the initial bonus is shown in the tables below. The amount of additional bonus depends on 3 of 6
whether the additional affordable units are Very Low Income or Moderate-Income Households:
Percentage Very Low-Income Units Percentage Density Bonus 5 20
6 23.75
7 27.5
8 31.25
9 35
10 38.75
Percentage Moderate-Income Units Percentage Density Bonus 5 20
6 22.5
7 25
8 27.5
9 30
10 32.5
11 35
12 38.75
13 42.5
14 46.25
15 50
Thus, if a project complied with the City’s AHPP by providing 15% on-site affordable units split evenly between Very Low (50% AMI), Low (80% AMI), and Moderate-Income (80% to 120% AMI) levels, the project would be eligible for an initial 50% density bonus.
Under AB 1287, if additional Moderate-Income units were provided in the project, an additional density bonus (up to 50%) would be available, resulting in a potential 100% density bonus. In that hypothetical scenario, the resulting project could potentially have up to 30% of the base units deed restricted as affordable. The City prepared an FAQ (Attachment F) explaining how these updated provisions of density bonus work.
In addition to increased density bonus potential, AB 1287 includes, but is not limited to, the following revisions to State Density Bonus Law:
1. Increases in the number of incentives or concessions, for the following projects:
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• Five incentives/concession for a project in which 100% of all units are for lower income households (originally four).
• Four incentives/concessions for projects that include at least 16% of the units for very low-income households or at least 45% for persons and families of moderate income in a development in which the units are for sale.
2. Further limits a jurisdiction’s ability to request documentation to establish eligibility for requested density bonuses, incentives or concessions, and waivers or reduction of development standards.
3. Modifies the definition of “Maximum Allowable Residential Density” or “Base Density”.
Zone Text Amendment Findings
In accordance with Santa Monica Municipal Code Section 9.46.080(A), staff recommends the City Council introduce for first reading the Ordinance based on the following findings, as set forth in Section 1 of the attached Ordinance:
1. The proposed amendments to the text of the Zoning Ordinance are consistent with the General Plan and any applicable Specific Plans in that the proposed amendments support policies in the Land Use and Circulation Element to the General Plan, the 6th Cycle (2021-2029) Housing Element, Bergamot Area Plan and Downtown Community Plan that support housing production in a manner consistent with State law.
2. The proposed amendments are consistent with the purposes of the Zoning Ordinance in that they update provisions for consistency with State Density Bonus Law, promote the growth of the City in an orderly manner, and promote and protect the public health, safety, and general welfare.
Environmental Review
The proposed approval of the ordinance to implement amendments for consistency with State Density Bonus Law per AB 1287 is exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the CEQA 5 of 6
Guidelines (common sense exemption). Based on the evidence in the record, it can be seen with certainty that there is no possibility that the proposed ordinance may have a significant effect on the environment. The proposed ordinance is administrative and regulatory in nature in that it creates additional pathways consistent with State Density Bonus Law for housing projects to achieve a greater density bonus if additional moderate-income or very-low-income units are provided on-site in housing projects. The ordinance would not alter development standards for housing projects previously analyzed as part of the 2021-2029 6th Cycle Housing Element Environmental Impact Report (EIR) [SCH No. 20212269242021] that was certified by Council on October 12, 2021, with an Addendum to the EIR approved on October 11, 2022. Therefore, no further environmental review under CEQA is required.
Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action. Staff will return to Council if specific budget actions are required in the future.
Prepared By: Ross Fehrman, Senior Planner
Approved Forwarded to Council
Attachments:
A. CDD-Ord-AB 1287 042324
B. Resolution Number 24-001 (PCS), Planning Commission Resolution C. Planning Commission Recommendation Letter for Local Off-Site Density Bonus Program
D. March 20, 2024 Planning Commission meeting (Web Link) E. April 17, 2024 Planning Commission meeting (Web Link) F. Summary of AB 1287’s Changes to State Density Bonus Law for Housing Projects (Web Link)
G. Written Comments
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H. PowerPoint Presentation