City Council
Report
City Council Meeting: August 27, 2024
Agenda Item: 10.A
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To: Mayor and City Council
From: David Martin, Director, City Planning
Subject: Introduction and Adoption of an Emergency Ordinance to Extend Building Permit and Construction Timelines and to Extend Timelines for Landmark Entitlements
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; and
2. Introduce and adopt an emergency ordinance amending (1) Santa Monica Municipal Code (SMMC) Sections 8.08.060 and 8.08.070 to increase building permit expirations for all projects, allow longer expiration timelines for building permit applications for 100% affordable housing projects, provide an increased number of extensions that can be granted by the Building Official, and allow all projects more time to complete construction; and (2) SMMC Sections 9.56.170 and 9.56.250 to align expirations and extensions of landmark entitlements with common procedures applied to other entitlements.
Summary
Staff has become aware of difficulties that projects are experiencing with current building permit application (i.e. plan check) expiration and extension timelines, particularly from affordable housing providers who often have to navigate complex funding sources and uncertain timelines that are out of their control. If standard permit application timelines are imposed, it would mean that permit applications expire and 100% affordable housing projects would be required to file new applications which would result in further delays. Staff is also generally experiencing an increased number of requests for extensions to time limits that all projects are given to complete the plan 2 of 11
check process (and obtain a building permit) and also to complete construction once a building permit is issued.
In addition, staff has become aware of inconsistencies between the expiration and extension timelines for Landmark entitlements (Certificate of Appropriateness and Certificate of Economic Hardship) compared to all other entitlements, with Landmark entitlements having a significantly shorter timeframe to execute a project and a more limited time extension request.
Therefore, to address these issues, staff proposes revisions to Article 8 and 9 of the Santa Monica Municipal Code to:
• Extend building permit application expirations for all projects; • Allow additional building permit application expiration time allowances for 100% affordable housing projects;
• Provide an increased number of extensions that can be granted by the Building Official;
• Allow all projects more time to complete construction; and • Align expirations and extensions of landmark entitlements with timelines applied to all other entitlements.
These revisions will align with Council’s goals of economic recovery and addressing homelessness by providing greater flexibility and certainty to projects, especially 100% affordable housing and historic preservation projects, which the city has always strived to support.
Discussion
Building Permit Application Expirations and Extensions
The plan check process is initiated with filing of a building permit application. City staff has been made aware that building permit application expiration timelines and limits on extensions in Article 8, Building Regulations, of the Santa Monica Municipal Code (SMMC) are presenting difficulties for 100% affordable housing projects because of the complex nature and uncertainty of decisions on funding sources. These factors are out 3 of 11
of the applicant’s control and can have significant impacts on project timelines because an applicant cannot obtain a building permit until funding is secured. Therefore, staff is recommending that Council adopt the below revisions to SMMC 8.08.060(h), Expiration of Application of Permit, and SMMC Section 8.08.060(i), Extensions, to provide more certainty and flexibility to 100% affordable housing projects, which would be defined as any housing project where all units are deed-restricted as affordable to 50% AMI, 80% AMI and/or Moderate-Income Households. These revisions will help address the Emergency Declaration of Homelessness and align with Council priorities of economic recovery and supporting the production of affordable housing.
In addition to revisions to support 100% affordable housing projects, staff is proposing increases to expiration timelines and the number of extensions the Building Officer can issue for all projects. Due to the challenging financing environment, staff is experiencing an increasing number of requests for plan check extensions due to the current strict expirations. These revisions will provide applicants more time to complete the plan check process and more time to complete construction before a permit expires. These revisions will align with the Council’s priority of economic recovery.
In summary, the proposed changes will result in the following:
• Revised timelines for projects to complete the plan check process and obtain a building permit:
Existing Proposed
Potential Total
Time
(Proposed)
Initial Expiration Timelines
All Building Permit Applications 1 year 18 months 18 months 100% Affordable Housing
Building Permit Applications 1 year 3 years 3 years
Allowable Extensions by Building Official
All Building Permit Applications 1 six-month
extension
Up to 3 sixmonth
extensions
3 years
100% Affordable Housing and
Coastal Zone Building Permit
Applications
1 six-month
extension
1 twelve-month
extension 4 years
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• Revised timelines for projects to complete construction once a building permit is issued
o Initial time to complete construction
▪ All building permits – 3 years (existing timelines ranged from 1 to 4 years depending on project valuation)
▪ Projects issued building permits during COVID-relief period – 5 years (existing timelines ranged from 3 to 5 years depending on project valuation)
o Extensions of time to complete construction (no changes proposed) ▪ Time to Complete Construction for all building permits– up to three 180-day extensions
▪ Time to Complete Construction for designated historic resources – up to four 180-day extensions
Proposed revisions to Section 8.08.060 and 8.08.070 are as follows:
Section 8.08.060 Permit Application
(h) Expiration of Application for Permit.
(1) A permit application shall expire if no permit is issued within 18-months one year after the date the permit application is filed, except as provided below.
(A) An application for a demolition permit for the demolition of residential buildings and structures, which are subject to the replacement project requirements of the City's Zoning Ordinance, shall expire if no permit is issued within two years following the date the application is filed.
(B) An application for a permit for a project subject to the construction rate program of the City's Zoning Ordinance shall not expire while that project remains on the waiting list for a building permit. (C) An application for a demolition permit for a building or structure in which the original permit was issued more than forty years before 5 of 11
the date of filing of the demolition permit application shall expire if no permit is issued within three years following the date the application is filed.
(D) An application for a project that requires a Coastal Development Permit shall expire if no building permit is issued within three years of the building permit application filing date; however, if the project includes an approved vesting tentative map, the permit application expiration date shall be extended to be concurrent with the term of the vesting tentative map for the project.
(E) An application for a 100% affordable housing project shall expire if no building permit is issued within three years of the building permit application filing date. For the purposes of this section, 100% affordable housing projects are any housing projects where all of the dwelling units are deed restricted as affordable to 50% AMI Households, 80% AMI Households, or Moderate-Income
Households.
(2) No action may be taken on an application after expiration. Plans and other data submitted for review may thereafter be returned to the applicant or purged by the Building Officer. To obtain a permit, applicants shall submit a new application, new submittal documents and pay a new plan review fee. All applicable standards in effect at the time of the new application shall then apply to the project.
(i) Extensions. The Building Officer may grant three one six-month extensions of the 18-month one-year plan check time period set forth in subsection (h)(1) above, if the applicant demonstrates that:. The Building Official may grant one twelve-month extension of the plan check time period set forth in (h)(1)(D) and (E), above. In all cases, the applicant must demonstrate that:
(1) No changes have been made or will be made to the original plans and specifications except as required by the original plan review; and 6 of 11
(2) No pertinent laws or ordinances have been amended subsequent to the date the original application was filed which would cause the development project at issue to be inconsistent with such amended provisions; and (3) Any approvals granted under Article IX of the Municipal Code are still valid and have not expired; and
(4) Circumstances beyond the control of the applicant have prevented the permit from being issued in the authorized time period.
Section 8.08.070. Permit issuance, extension and renewal. (c) Expiration. Every permit issued under the provisions of this Code expires by limitation and becomes null and void when any of the following circumstances is applicable:
(1) Failure to Start Construction. If the building or work authorized by such permit is not started within one year from the date of permit issuance; (2) Cessation of Work. If the building or work authorized is suspended or abandoned at any time after the work has started, for a period of one hundred eighty days or more;
(3) Time to Complete. In addition to subsections (1) and (2) above, every permit issued under the provisions of this Chapter expires by limitation and becomes null and void when the time allowed to complete all work authorized by the permit exceeds three years from the date of permit issuance, except as provided in subsection (A).the time periods set forth in this subsection, based on valuation. When a project is divided into separate permits for the convenience of the owner or tenants, and the work on such permits is to be done concurrently, the time allowed to complete all work on each separate permit shall be equal to the time period for the total valuation of the separate permits. (A) Except as provided in subsection (B), the time allowed to complete all work authorized by a permit shall be as follows:
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Valuation Time Allowed
Under $300,000.00 12 months
$300,001.00 to $1,000,000.00 24 months
$1,000,001.00 to $20,000,000.00 36 months
Over $20,000,000.00 48 months
(B) Notwithstanding subsection (A), the The time allowed to complete all work authorized by a permit (i) issued and active as of March 13, 2020; (ii) issued between March 13, 2020 and December 31, 2022; or (iii) issued pursuant to a complete application submitted between March 13, 2020 and December 31, 2022, shall be five years. as follows:
Valuation Time Allowed
Under $300,000.00 36 months
$300,001.00 to $1,000,000.00 48 months
$1,000,001.00 to $20,000,000.00 60 months
Over $20,000,000.00 72 months
(d) Extensions.
(1) Extensions of time from the stated periods in subsection (c) above may be permitted for good reason, provided such requests are submitted to the Building Officer in writing prior to permit expiration. The written request must demonstrate that:
(A) Due to circumstances beyond the owner's or permittee's control, construction could not be commenced, continued or completed in the authorized time period;
(B) If construction has started, substantial progress has been made; (C) The condition of the property presents no health or safety hazard; and (D) The continued delay will not create any unreasonable aesthetic impact to the neighborhood or substantial economic detriment to neighboring property owners.
(2) The time periods set forth to start construction within one-year hundred eighty days or resume construction after cessation of work for one hundred eighty days may each be extended no more than once, and the time period set forth to complete construction may be extended no more than three 8 of 11
times; however, if the project includes the preservation of a designated City of Santa Monica landmark, the period to complete construction may be extended no more than four times. Each extension of time shall not exceed one hundred eighty days.
Extension of Landmark Entitlement Timelines
Staff has become aware of inconsistencies between expiration dates and the potential length of extensions for landmark entitlements (Certificate of Appropriateness and Certificate of Economic Hardship) and all other land use entitlements. Currently, landmark entitlements expire if work has not commenced within one year from the date of issuance with no additional time for projects within the Coastal Zone. Landmark entitlements are only permitted one 180-day extension.
Pursuant to Santa Monica Municipal Code Section 9.37.090(A) and (C), all other entitlements expire if not excised within two or three years (depending on project type) of the effective date, with an additional six months granted for projects within the Coastal Zone. These entitlements are afforded a first time extension of either a 6-month or 1-year extension (depending on project type). The Director can grant an additional time extension for designated historic resources.
As this appears to be an oversight, staff proposes to align landmark entitlement expirations and extensions with the expirations and extensions for all other entitlements.
Additionally, to assist current applicants that are coming up against these strict deadlines, staff proposes to apply these new expiration timelines to all landmark entitlements that are active and issued as of July 1, 2024. This revision and applicability date will help encourage historic preservation and align with the Council’s priority of economic recovery.
In summary, the proposed changes will result in the following expirations and extensions for landmark entitlements:
• 100% affordable housing and qualifying mixed-use affordable housing projects o 3 years initially (3.5 years if in Coastal Zone)
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• All Other Projects
o 2 years initially (2.5 years if in Coastal Zone)
• Extensions
o Residential uses: 1 year
o Non-residential uses: 6 months
o Designated historic resources: eligible for one more time extension Proposed revisions to Sections 9.56.170 and 9.56.250 are as follows:
Section 9.56.170 Certificate of Appropriateness/Certificate of Economic Hardship Procedure.
An application for a certificate of appropriateness or an application for a certificate of economic hardship approving any proposed alteration, restoration, construction, removal, relocation, or demolition, in whole or in part, of or to a Landmark or Landmark Parcel, or of or to a building or structure within a Historic District shall be processed in accordance with the following procedure:
H. Subject to other provisions of Sections 9.56.170 and 9.56.180 of this Chapter, a certificate of appropriateness or certificate of economic hardship shall be in full force and effect from and after the date of the issuance by the Commission. Any certificate of appropriateness or certificate of economic hardship issued pursuant to this Chapter shall expire within the timeframes stipulated in Section
9.37.090(A), Expiration, for projects that are active and issued as of July 1, 2024., unless the work authorized by the certificate of appropriateness has commenced:
1. Except as provided in paragraph 2, below, one year from the date of issuance.
2. Notwithstanding paragraph 1 above, 3 years from the date of issuance for a certificate of appropriateness:
a. Issued and active as of March 13, 2020;
b. Issued between March 13, 2020 and December 31, 2022; or 10 of 11
c. Issued in accordance with a complete application that was submitted between March 13, 2020 and December 31, 2022.
3. In addition, any such certificate of appropriateness or certificate of economic hardship shall also expire and become null and void if such work authorized is suspended or abandoned for a 180-day time period after being commenced.
Section 9.56.250 Extension of Certificate of Appropriateness.
The Landmarks Commission Secretary may extend the time period for exercising a certificate of appropriateness as provided for in Section 9.56.170(H) pursuant to Section
9.37.090(C), Extensions, for a period of up to 180 days upon such terms and conditions as the Secretary deems appropriate consistent with the original approval and Section 9.56.170 if the development standards relevant to the project have not changed since project approval. An extended certificate of appropriateness shall expire if the work authorized thereby is not commenced by the end of the extension period. Except as otherwise provided for in this Section, all provisions of this Code applicable to a certificate of appropriateness shall apply to an extended certificate of appropriateness.
Environmental Review
The proposed Emergency Ordinance to extend building permit expirations, allow additional expiration time allowances for 100% affordable housing projects, provide an increased number of extensions that can be granted by the Building Official, and align expirations and extensions of landmark entitlements with common procedures applied to all other entitlements are exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the State Implementation Guidelines (common sense exception). Based on the evidence in the record, it can be seen with certainty that there is no possibility that the proposed changes may have a significant effect on the environment. The proposal would not result in adverse physical environmental effects as these are procedural changes. Therefore, no further environmental review under CEQA is required. Projects issued permits would be undergoing their own separate CEQA review prior to permit issuance. 11 of 11
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, Principal Planner
Approved Forwarded to Council
Attachments:
A. 2024.08.27 - Building Permit & Landmark Extension Emergency Ordinance B. Written Comments