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Housing Plan Delays Led to Loss of Local Control

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By Jorge Casuso

October 14, 2022 -- After nearly three years in the works, State officials on Friday certified Santa Monica's Housing Element -- but not before 16 projects totaling more than 4,500 units were rushed into the planning pipeline.

The approval came after the previous City Council embarked on the process in December 2019 and nearly seven months after State officials rejected the current Council's plan to build nearly 9,000 housing units by 2029.

The certification by the California Department of Housing and Community Development (HCD) came three days after the Council approved its updated plan on Tuesday, barely making the Saturday deadline.

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But it came too late to stop a sudden flood of submissions in the final two weeks, almost all of them filed by WSC and NMS, which together were responsible for 15 of the 16 proposals totaling 4,562 units, of which 941 are affordable.

The last ditch proposals -- which bypass the City's zoning code and general plan -- blindsided the Council, which last October approved the first draft of a new Housing Element submitted every eight years ("City Officials Caught Off Guard by Flurry of Development Submissions," October 13, 2022).

"This adoption comes after a two year-long process that included significant community engagement as well as major changes in state law that both impacted the housing capacity studied and reduced local control for qualifying housing projects," City officials wrote in a press release issued Friday.

The City submitted its final draft to State officials one year after a divided Council on October 12, 2021 approved a plan to build 8,895 new units, 69 percent of them affordable.

Council Changes Course

The move came nearly three years after the previous Council had embraced the daunting task of meeting the housing quota during a study session in December 2019 ("Santa Monica Takes Initial Step to Dramatically Boost Housing Production," December 13, 2019).

In March 2020, Santa Monica became the first Southern California city to proactively take steps to meet its goal by approving an emergency interim ordinance it hoped would spur developers to meet the State housing quota ("Santa Monica Scrambles to Meet Housing Targets Other Cities Are Opposing ," March 9, 2020).

But a voter revolt at the ballot box that November upended those plans when three members of the slow-growth Change slate ousted three incumbents and changed course on the City's housing plan ("Santa Monica Voters Usher in New Era," November 6, 2020).

A month before a draft of the Housing Element was due in October 2021, the newly seated Council was looking for ways to challenge the housing mandates ("Santa Monica Could Join in Challenge to State Housing Mandates," September 23, 2021).

On October 12 , the Council reluctantly approved a Housing Element, but cautioned State officials that the City would need help meeting its goal ("Council Cautiously Approves Housing Plan," October 13, 2021).

"We're doing everything we can, we're running as fast as we can, and this is really impossible," Mayor Sue Himmelrich said before voting for the plan. "I think we need to say that."

Backed by Himmelrich and the Council's slow-growth faction, the Housing Element departed from previous plans that counted on private developers to meet the State mandates.

Instead, the plan relied on non-profit housing providers using City-owned land and homeowners adding auxiliary rental units to meet its State-mandated housing quota.

Councilmember Gleam Davis -- who along with Kristin McCowan cast the dissenting votes -- warned that the plan left single family neighborhoods "completely intact with no affordable housing" and failed to address the need for "middle income housing that is market rate."

Council Plan Rejected

State housing officials agreed. In a letter dated February 8, HCD said the Council's plan failed to comply with State law and needed to be revised ("Housing Element Fails to Comply," February 11, 2022).

The City, State officials said, needed "to add or revise programs to address a shortfall of sites or zoning available to encourage a variety of housing types."

At its April 26 meeting, the Council discussed the changes needed to meet the overall housing capacity analyzed in the Housing Element, which had by now increased to more than 13,000 units.

Two months later, on June 21, it approved the changes after the Planning Commission weighed in.

The revisions addressed constraints on development, increased building standards in areas that had traditionally lacked affordable housing and paved the way for more housing development in single family neighborhoods.

The revised plan also identified five City-owned sites that could accommodate 1,880 affordable housing units for lower income tenants.

"The City hopes to receive a 'draft in compliance' letter from HCD on the submitted redline revisions, which would provide a path forward for the City Council to adopt a revised compliant Housing Element," City officials said.

Nearly two months after the City submitted its final plan, State officials informed Planning Manager David Martin that the revised plan would be in compliance once it received final approval.

On September 22, the Planning Commission reviewed the final draft and recommended that the City Council adopt it with minor amendments.

"The community will have two weeks to review the draft prior to the October 11th adoption hearing with City Council," City officials announced.

"Once the plan is adopted, the City will submit the final draft to HCD for their review and certification by their October 15th deadline."

Housing Developers Rush In

Before the public review had ended, Dave Rand, the land use attorney for WSC and NMS, had submitted plans for 11 projects -- including a 15-story residential tower at 330 Nebraska Avenue with 1,600 market rate units and 400 affordable units.

At the Council meeting last Tuesday, Councilmember Phil Brock created a buzz on the dais when he asked about the builder's remedy the developers had used.

"We're all just taken aback," Brock said Thursday morning. "Obviously I was like, 'What the hell.' Why didn't they tell us as a Council so we could do something to combat this."

For nearly three years City staff had mentioned the possible loss of local control over development projects if the Housing Element failed to comply, but they repeatedly focused on the possible loss of State funding.

By the time the City's plan received the State's blessing on Friday, WSC and NMS had submitted two final projects, which like the other 12 proposals require little public input.

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