Six years of process, and then . . . boom!

At the City Council meeting last Tuesday night on Santa Monica’s Downtown Community Plan (DCP) the ironies abounded. As planning staff has told us many times, the DCP is the result of six years’ of process involving countless public meetings, along with studies and other work by consultants. The Monday night before Tuesday’s meeting itself featured about 150 community members testifying on the plan. Yet to make the biggest decisions about the plan, on the most difficult, contentious and significant issues, the City Council had only time for frantic deliberations as Mayor Ted Winterer pushed them to take “straw votes” as if they were on a life-and-death deadline.

So much for deliberative representative democracy.

Not only that, but the debate over the very most contentious and significant issue—the amount of affordable housing to require for-profit developers to build—was based on a new financial analysis that had been assembled in admitted haste over the previous weekend in response to a recommendation from the Housing Commission to expand the required amount of affordable housing to 30% in some circumstances, a percentage more than what any other jurisdiction in California requires. This analysis, by the City’s regular consultant, Paul Silvern, had not been released to the public for comment or even given to the councilmembers prior to the meeting. The first they heard of it was Silvern’s oral presentation Tuesday night.

Based on this analysis the councilmembers voted to require an on-site affordable housing requirement of more than 20% on any market-rate apartment building greater than 50 feet in height, reaching a 30% affordable requirement at 70 feet in height. I’d say that these numbers are unprecedented, but in fact they would bring Santa Monica back to where it was in the early 1990s, when it had a 30% requirement. For those without long memories, the results of that requirement were (i) no housing got built, and (ii) housing developers sued the City and won, and the City had to revise its zoning so that housing could be built.

While anti-change forces in the City have been chipping away at that 1990s pro-housing zoning for 20 years, it’s the DCP that is finally replacing it entirely. Ironic for a plan that is touted as a “housing plan.”

But I want to be fair to Paul Silvern: I said his analysis was what the council used to justify going to 30%, but he himself, as passionately as I’ve ever heard him speak, advised the council not to go there. He did not believe his analysis of theoretical and marginal financial feasibility at the 30% level provided justification for requiring it.

And I also don’t want to be completely negative. The council did some good things at the meeting, building on good work from the Planning Commission and staff.

For one, the council voted to remove parking minimums for developments downtown; this was in fact a “forward to the past” move, since the City back in the 1960s removed parking minimums for the core area around Third Street, but 50 years later it’s still considered a brave and radical move.

For two, the council approved expanding significantly (though not as far as would have been justified) the scope of administrative review over housing development. It was telling, however, that some councilmembers wanted to get back every bit of advantage this gave housing developers by assessing new burdens on the construction of market-rate housing. This is where the impetus to increase the on-site affordable housing obligation to 30% came from.

The council also approved reasonable development standards for the three large hotel sites downtown, gave more incentives to 100% affordable housing developments, and increased allowable development in the “Neighborhood Village” area south of Wilshire (although this last improvement will probably be moot considering the increased affordable housing cost put on developments above 50 feet in height).

But getting back to housing, some readers might be wondering why I, a proponent of building affordable housing, object to piling affordable housing requirements on market-rate housing. The reason is that we need market-rate housing just as much as we need affordable, because if middle-class households can’t find new housing that they can afford, particularly in historically middle-class areas like the Westside, then they will cannibalize existing housing occupied by low-income people. This is what is happening all over California, as reported in the papers (including now the New York Times) nearly every day. Housing and neighborhood activists decry gentrification, but discouraging investment in housing is what drives increases in housing costs.

For so long as we have more people who don’t qualify for affordable housing than who do, which is, by the way, a good thing, then, by definition, or simple math, we need more housing for people who don’t qualify. We need that housing to be built, and if we unreasonably burden developers who build it, or owners of the property it could be built on, we won’t get it.

It’s not like there shouldn’t be inclusionary housing. We also have a value that we want housing for different incomes to be mixed together or in proximity. And in a rising housing market, there are some developer profits that can be tapped for this purpose, if developers are given sufficient entitlements to build and there is certainty in the process. But we have to recognize that more investment will be attracted to housing development the lesser the burdens on it.

Ultimately the money for building necessary affordable housing must come from the whole of society.

Thanks for reading.

Downtown Santa Monica: where it doesn’t take a village (with lots of pictures!)

It’s back! The latest (and promised final!) version of Santa Monica’s Downtown Community Plan (DCP), is being dragged through the Planning Commission, with an ultimate destination of the Promised Land, namely approval by the City Council. The DCP is the current installment of Santa Monica’s quasi-permanent, general plan-level, planning process, now approaching the middle of its second decade.

Late last year I wrote three articles about the previous, 2016 version of the DCP, and I’ll probably write at least three about this iteration, too. In some respects the 2016 version has been improved, and some others it’s been made worse, but my overall reaction to the plan has not changed: the plan is more a political document than a planning document.

By “political” I mean that more of the plan’s 290 pages are explaining than are planning. The DCP is the product of staff and consultants who’ve been yelled at a lot, and who are trying to anticipate the path of least political resistance so that they can get enacted something that at least rhetorically they can be proud of.

As a result, much of the plan is not planning but flattery — not only soothing words to make Santa Monicans feel special and fawned upon, but also flattery for the plan itself. Never are Santa Monicans told the truth, which is that much of downtown has been and is a dump, needs new investment, and dammit it could be made a lot better.

Instead, we get a lot of how the DCP will preserve “character and history,” and carefully integrate “the new with the best of the old,” and “carefully nurture Downtown’s character and sense of the past,” not only with “enhanced historic preservation,” but also with “context sensitive infill.” There’s a lot about “sustainability” and “wellbeing.”

We’re constantly being told about downtown’s character, as if it’s the hero or heroine of a romance novel, as if the “scale” of downtown has anything to do with its success. We all know that but for locating new movie theaters downtown and getting a good designer (Boris Dramov) to fix up what was then the Third Street Mall, Downtown Santa Monica would still be the scary ghost town it was in 1981 when, as a member of the Odyssey Theatre’s board, I tried to persuade Third Street property owners to subsidize a theater for the Odyssey to bring some life to the decrepit pit. (Thankfully Denny Zane, whom I first met at the time, ultimately had a more realistic vision.)

When the planners aren’t patting us on the back for being so brilliant because we happen to have a vibrant downtown (I guess we should take credit for the ocean, too), we get reassurances about the plan itself like these:

The community’s expectation for the Downtown area to expand as an energetic, equitable and sustainable urban neighborhood is addressed [by the DCP] through physical land-use planning integrated with circulation policies, and a well-rounded emphasis on community services and amenities. Many of the policies and actions throughout this document aspire to nurture neighborhood and economic prosperity . . . .

Good to know! I’d hate to have a plan that aspires to destroy neighborhood and economic prosperity.

Last year I wrote about how the euphemisms in the plan annoyed me, and my bête noire was calling a crucial core piece of downtown, seven and a half mostly underdeveloped blocks straddling two major transit boulevards, the “Neighborhood Village.”

Here’s a map of the “Neighborhood Village” (NV) (in yellow):

NV District map

You know these blocks: It’s not like there are dirt roads and thatched roofs there, or cows and chickens. This is where the Main Library and the YMCA are. The new hotel at 710 Wilshire, incorporating a large landmarked structure, is under construction. Some of the other large buildings in Downtown are there, too. Here’s a picture of Sixth Street north of Arizona, showing Santa Monica Towers.

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And don’t forget the former telephone company building that now houses the restaurant Cassia.

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Not only that, but much development of mixed-use buildings, with typically four stories of apartments over a ground floor of retail or small offices, has already occurred in the district, like this one.

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The DCP doesn’t note how much better these new developments have made the area from what it was before. For all the charm and character the DCP assures us downtown has, the older buildings on the NV blocks are mostly an incongruous collection of bad modernism and worse kitsch, all punctuated by parking lots and “cars behind bars” curb cuts and black holes. Here are some of my favorites.

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Kitschy office building trying to look like apartments.

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Two really friendly modern buildings, side-by-side.

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Your classic Mission Revival mini-mall. Don’t tell me, someone wants to landmark this.

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Slanted roofs! How village-like. Note the cars-behind-bars-black-hole motif.

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My absolute favorite. Undefinable Olde English kitsch on top of cars-behind-bars black hole. Let’s create an Olde English village in DTSM! We can have wassail parties (whatever wassail is).

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And of course a dental office surrounded by parking. The suburban vista that so warms the hearts of some.

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Yes, there once was a village. Let’s bring back the Long Wharf, too.

Sure, there are a few vestigial wood-framed throwbacks to when, more than a century ago, downtown was at least village-like, but there is no village there now. Instead, on their own, with largely private investment, these blocks have, since the City liberalized the zoning for housing 20 years ago, been making an excellent transition to a mixed, post-sprawl neighborhood of five-story apartments, shops, offices, hotels and public-serving uses. It’s the past 20 years of development, not some false nostalgia, that the DCP should be celebrating and building upon.

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Real people live here.

So one has to ask, why do intelligent planners and consultants call an area like this a village? The answer is political. The more distinctions the planners can make in the amount of development allowed from one area to another, the more they can demonstrate (truthfully in fact) that they’re listening to those residents who are angry about any and all development.

Let me step back for a moment from my criticism to say that I don’t believe that the amount of development the DCP allows is, in most instances, too little for downtown. The problems with getting housing built, that many people are complaining about and about which I’ll write in a future column, have more to do with the approval process than with the amount of development allowed.

But look at the difference between the amount of development (which is expressed by the permitted “floor-area ratio,” or FAR) that the DCP allows in the NV area and the amount allowed in the “Transit Adjacent” (TA) area immediately to the south. Here’s a map of the Transit Adjacent area (in turquoise):

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In TA, for Tier 2 projects with housing, the DCP allows for an FAR of 3.5 while the NV only allows 3.25. (A quarter point of FAR is financially significant, especially considering the costs that the City lays on housing development.) When it comes to larger developments, TA allows for Tier 3 projects with potentially an FAR of 4.0 (which is about what apartment buildings got under the 1990s zoning that allowed a double FAR for housing, so it’s not too much), while the NV doesn’t allow Tier 3 projects at all.

Not only that, the TA area is already more built-out than the NV area, or occupied by uses like the City’s bus yards. So the NV area is a more promising area for continued residential growth.

There is no reason to make a distinction between the NV blocks, which are either between or straddle Santa Monica and Wilshire Boulevards, and the TA blocks between Santa Monica and Colorado. The former are a little further from the Expo station, but both Wilshire and Santa Monica Boulevard are routes for Metro Rapid buses that will, within the lifetime of the DCP, connect with the Purple Line subway, as well as major Big Blue Bus routes to UCLA and elsewhere.

When there is no real reason to make a distinction, look for a political one.

Call it a village.

Thanks for reading.

Housing is Complicated — Post #1

I attended a fascinating meeting of the Housing Commission Thursday afternoon. The only item on the agenda was the question, which the City Council will likely take up this summer, whether the City should readjust the parameters for production of affordable housing. These parameters include the limits on income that households can make to qualify for affordable housing, and the amount of rents that affordable housing providers can charge. (The commission heard from a panel of experts, asked a lot of good questions, asked staff to come back with more information, and postponed making their recommendations until their meeting in May.)

Anyone who has paid attention to City Council hearings lately, on matters such as the Village Trailer Park, or what developments should receive expedited planning review, has heard a lot about the different categories of affordable housing. These include extremely low, very low, low, and moderate. These terms all have definitions, but those definitions vary depending upon various factors, such as where the financing comes from to build the housing or what governmental entity is making the rules and for what purpose.

Santa Monica has a definition of its own, which it uses for one purpose. (It uses other definitions for other purposes, too.) This definition was included in Proposition R, which the voters passed in 1990, and which requires that 30% of all multifamily housing built in Santa Monica be affordable to “low and moderate income households.” Prop. R defines those terms with reference to the Los Angeles County median income as determined by the federal Department of Housing and Urban Development: “low income” under Prop. R means a household with income not exceeding 60% of the county median, and “moderate income” means a household with an income not exceeding 100% of it. Under Prop. R at least half of the 30% (i.e., at least 15% of all housing production) must be affordable to and occupied by low-income households.

Santa Monicans support the building of affordable housing – in 1999 voters here passed an authorization for the City to build more of it, an authorization that is generally difficult to get passed, and in opinion surveys the cost of housing regularly appears as one of the primary concerns of residents.

One of the many interesting aspects of Prop. R is that while its stated purpose is to make sure that Santa Monica as it evolves maintains its historic economic diversity, with housing affordable to both low and middle-income families, Prop. R also has the potential to limit all housing development. Under Prop. R the amount of market-rate housing development is limited by the amount of affordable housing: the number of market-rate units built under the “70%” is limited by the number of affordable units built under the “30%.” For instance, if only 60 affordable units are built, only 140 market-rate units can be built.

At the same time, the City has always relied on market-rate housing developers to provide at least some of the affordable 30% — particularly moderate income housing that can be financed from private markets without subsidy. With the end of redevelopment, which provided much of the funding for low-income housing, the City will be looking even more to market-rate developers to provide affordable housing by “subsidizing” it with profits from market-rate rents. (The City is also now going to seek housing funds from commercial development.) The equation works the other way, too – if you want a big number of units in the 30%, you need a big number in the 70%.

It should be no surprise then that the politics of affordable housing have always been entangled with the politics of development. Affordable housing advocates, including non-profit providers that have had to deal with anti-development groups the same as for-profit developers do, have often made common cause with the latter to fight restrictive zoning policies. Meanwhile, the largest for-profit developers of housing in Santa Monica have typically built affordable housing to satisfy their affordable housing obligations rather than pay an in-lieu fee because they know that if the 30% figure is low, they ultimately will not be able to build as much market-rate housing.

On the other side of the political equation, anti-development interests have used affordable housing requirements as a means of making development less financially feasible and otherwise more difficult.

Personally, this attention to affordable housing has given me an opportunity to learn about the effects of different parameters on how and what affordable housing gets developed, and about how affordable housing can be financed in the post-redevelopment world. In posts over the next couple of weeks I expect to share what I learn and my thinking on the subject.

Thanks for reading.