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State Certifies Manhattan Beach's Housing Plan

Aug 01, 2023 10:44AM ● By Jeanne Fratello
California's Department of Housing and Community Development (HCD) has officially certified Manhattan Beach's Housing Element, a plan that describes how the city could gradually increase housing density by its designated target of 774 new units.

The state-required Housing Element is a strategic vision and policy guide designed to help address the comprehensive housing needs of the city over an eight-year period (in this case, the 2021–2029 planning period). It defines the city’s housing needs, identifies the barriers or constraints to providing needed housing, and provides policies to address these housing needs and constraints.

Although the city is not required to build housing, the state requires each local government to demonstrate where housing can reasonably be expected to be added within this cycle and how the city will facilitate and incentivize its production. The Regional Housing Needs Allocation (RHNA) has given Manhattan Beach the target of 161 extremely low-income units, 161 very low-income units, 165 low-income units, and 155 moderate-income units.

Cities throughout California must submit such a plan and receive certification from HCD. By earning certification, Manhattan Beach will continue to be eligible for several state grant funding programs, and will be protected from associated litigation and loss of permitting authority.

“Our City Council has been dedicated to representing the needs of our residents and business community. Part of that has been maintaining as much control over the decision-making process as possible,” said Mayor Richard Montgomery in a statement. “This is a monumental step for the city and will allow us to maintain authority to issue residential and non-residential permits—keeping the integrity of our zoning laws and saving our small town character. I congratulate Community Development Director Talyn Mirzakhanian and the entire city staff on the years of persistent hard work that they poured into this project.”

Staff began drafting the 6th cycle Housing Element, which involved extensive research, coordination, and review of existing regulations and sites, in July 2021. Over the last two years, the city conducted significant public outreach by way of study sessions and workshops with the Planning Commission and City Council.

“The State’s 6th cycle Housing Element update requirements were the most cumbersome and challenging to date for all jurisdictions. It was particularly challenging for Manhattan Beach, given that we are an entirely built-out city,” said Mirzakhanian in a statement. “After over two years of community engagement, public hearings with the Planning Commission and City Council, and significant dedication of staff resources, we are pleased to have secured HCD’s certification and the reassurances that come along with it.”

Housing Element Plan Had Been Approved Reluctantly

The Manhattan Beach City Council had voted - reluctantly and narrowly - in March 2022 to approve the state-mandated housing plan. Councilmembers added the caveat that they were voting "under protest" against the requirements from Sacramento.

The directive to plan for 774 new units was essentially 20 times the requirement outlined for the previous 8-year cycle, when only 38 new units were required.

The city's housing plan, prepared by staff, identified many areas around the city, in commercial corridors as well as residential districts, where new housing or mixed-use development, under new zoning rules, could help the city meet the target of 774 new units. 

Previously, in February 2022, councilmembers had agreed on a 5-0 vote to let the housing element deadline pass and to continue discussing the plan in a closed session, leaving the risk of legal and financial consequences for missing the deadline, rather than accept the requirements.

At the time, city staff had warned councilmembers that noncompliance with the state-mandated deadline could be risky for the city.

The consequences of failing to adopt a plan would have been steep. The city could have incurred financial penalties of up to $10,000-$100,000 per month, and could be exposed to litigation from housing rights organizations, developers and the California Department of Housing and Community Development.

Additionally, a city could be stripped of its authority to issue any building permits, including for remodeling projects, or to grant zoning changes, with the city's "general plan" deemed invalid.

Manhattan Beach is not alone in grappling with its housing element: Many cities around California are struggling with comparably large increases in housing mandates from the state.

What's a RHNA?

Since 1969, California has required that all local governments (cities and counties) adequately plan to meet the housing needs of everyone in the community. California’s local governments meet this requirement by adopting "housing plans" as part of their “general plan” (also required by the state).

General plans serve as the local government’s blueprint for how the city and/or county will grow and develop and include seven elements: land use, transportation, conservation, noise, open space, safety, and housing.

In order to create a housing plan (a.k.a. "housing element") showing it could meet the local housing needs, a jurisdiction must first know how much housing it must plan for (and estimate how much will be needed at a variety of affordability levels in order to match the needs of the people who will live there). This is determined by a process called the Regional Housing Needs Assessment.

The California Department of Housing and Community Development (HCD) is responsible for determining the regional housing needs assessment (segmented by income levels) for each region’s planning body known as a “council of governments” (COG). HCD starts with demographic population information from the California Department of Finance and uses a formula to calculate a figure for each region/COG.

Each COG uses its own demographic figures to calculate what it believes the regional housing need is. Each COG then coordinates with HCD — taking into account factors not captured in the calculations — to arrive at a final figure. This final figure is the regional housing needs assessment.

Once HCD and the COG have agreed to the region’s assessment figure (the amount of housing that must be planned for), the COG takes over and is responsible for divvying up the housing need amongst all of the jurisdictions within that region. The COG - in this case, the Southern California Association of Governments (SCAG) - does this in a Regional Housing Need Allocation Plan (RHNA Plan).

The 6th Cycle RHNA (2021-2029) had called for Manhattan Beach to make a dramatic increase in its number of housing units.

In light of the similar challenges faced in this cycle by many cities, a statewide ballot initiative was championed by Redondo Beach Mayor Bill Brand and two other civic leaders to make city zoning laws supreme over state requirements.

The measure was withdrawn as it became clear that the campaign could not obtain the required number of signatures to qualify for the November 2022 ballot. Supporters have said they will come back and and try to qualify for the November 2024 ballot.

Meanwhile, the the South Bay Cities Council of Governments (SBCCOG), which has pushed back against RHNA, is leading a project to identify and reimagine underutilized commercial properties that are strong candidates for new housing to increase housing supply.

The project is assessing under-performing South Bay parcels for potential redevelopment. The areas being surveyed include strip arterials, regional malls, office buildings and industrial parks. Cities participating in the research include Manhattan Beach, Hermosa Beach, Redondo Beach, El Segundo, Carson and Hawthorne.

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