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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION
f OF THE PROVISIONS OF STATE LAW RELATIVE TO
LOW AND MODERATE INCOME HOUSING WITHIN THE COASTAL ZONE,.
a'
BACKGROUND
r
The City of Newport Beach (hereinafter "City ") "has the
responsibility for the administration of provisions of,tate law
relative to the demolition and conversion of existin&.4ow and moderate
income residential units and construction of new aff ,6rdable housing
within the Coastal Zone. (Chapter 1007, Statues off 1981, Government
Code Section 65590 et.seq.) 1
This Council Policy establishes the Yministrative Guide-
lines and Implementation procedures to be use by the City in adminis-
tering the provisions of the State law refer ced above.
The City Council of the City of wport Beach has, by virtue
of the adoption of this policy, determine that it is not feasible to
require replacement housing units for loV and moderate income persons
or families for projects involving the &nversion or demolition of one
or more structures located upon any pa el within the City containing
two or fewer residential units. The y Council finds that replace-
ment housing for projects involving tAo or fewer units is not feasible
due to the high cost of land within the City, the limited number of
substandard housing units that can be rehabilitated, the relatively
small profits that flow from projects involving two or fewer residen-
tial units, and the negligible impact that such conversions or demo-
litions have on the low and moderate income housing opportunities
within the City. The City Council intends, by adoption of these
guidelines, to provide opportunities for affordable housing in the
Coastal Zone, and these guidelines shall be interpreted in a manner
which will maximize such housing opportunities.
I
GENERAL RULES
1. Exempt Projects
This P/olicy shall not apply to the following projects:
a. .,Projects not located within the Coastal Zone as
established pursuant to the Coastal Act of 1976
and as subsequently amended;
b// The conversion, demolition, or construction of a
residential structure on any single parcel which
contains two or fewer residential units;
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
THE COASTAL ZONE - Page 2
C. The conversion or demolition of a residential
structure for purposes of a non - residential use
which is either "coastally dependent" or "coastal -
ly related" as those terms are defined in the
Coastal Act of 1976, as amended, and which
non - residential use is consistent with the appli-
cable local Coastal Plan designation;
d. Demolition of any structure which has been de-
clared to be or constitutes a public nuisance,
pursuant to the provisions of Division 13 of the
Health & Safety Code of the State of California or
any Ordinance of the City enacted pursuant there-
to.
2. At the time an Application is filed, the Applicant
shall pay a fee of $250.00 per each residential unit to
be converted, demolished or constructed, whichever is
greater, said fee is to defrav the administrative costs
and expenses incurred by the City in administering the
provisions of these Guidelines and Section 65900
et.seq. of the Government Code. The Planning
Commission may approve a reduction in fees for projects
of 40 units or more. In addition, the Applicant shall
pay all projected - related costs of any feasibility
studies deemed to be necessary for the administration
of these guidelines and /or Section 65900 et.seq. of the
Government Code.
II
DRPTNTTTONS
For the purposes of this policy, the following words and
terms shall be defined as follows:
1. "Conversion" shall mean any change in the form of
ownership of any residential structure, including, but
not limited to, a change in ownership to a condominium,
stock cooperative, cooperative, community apartment,
timeshare or similar form of ownership, such that the
right to occupy the structure is not based upon a
rental or lease agreement, written or oral, rather,
based upon the purchase of the right to occupy some or
all of the structure during a portion or all of the
year, or for a period of years, or in perpetuity, or
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
THE COASTAL ZONE - Page 3
any change from a residential use to a non - residential
use;
2. "Demolition" shall mean the destruction or tearing down
of a residential structure which has been found feasi-
ble for retention pursuant to Section 30612 of the
Public Resources Code;
3. "Feasible" means capable of being accomplished in a
successful manner within a reasonable period of time,
taking into account economic, environmental, social and
technical factors;
4. Replacement Unit" shall mean a residential structure
suitable, in terms of size and other characteristics
for occupancy by the same number of low or moderate
income persons that occupied the converted or demol-
ished unit.
5. Persons and Families of Low or Moderate Income" shall
be defined as set forth in 450093 of the California
Health and Safety Code.
6. Affordable Units" shall be defined as those housing
units affordable by persons and families of low or
moderate income. Affordability shall be calculated by
referring to the appropriate annual income level for
Orange County found on the State of California Family
Eligibility and Affordability Income Limits Table,
promulgated in California Administrative Code, Title
25, Part I, Chapter 6.5, Subchapter 2, Section 6932 for
one - bedroom units as if occupied by two persons;
two - bedroom units as if occupied by four persons;
three - bedroom units as if occupied by six persons; and
four - bedroom units as if occupied by eight persons.
The rent calculation shall then be made as follows:
annual income from table) x .3 e 12 = maximum rent.
7. Family" shall be defined as any group of persons
living as a single housekeeping unit within a dwelling
unit as defined in section 20.87.140 of the Newport
Beach Municipal Code.
8. New Housing Development" shall be defined to mean the
construction, of three or more residential units on:
1) Vacant land; 2) Land occupied by existing
residential units which may be converted or demolished
without any requirement for replacement units.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN •
THE COASTAL ZONE - Page 4
9. "Planning Director" shall include the Planning Director
of the City and all employees of the Planning Depart-
ment to whom the Planning Department has delegated,
orally or in writing, the performance of duties
required by these Guidelines.
10. "Developer" shall mean the person or entity that, at
the time of the issuance of any permit required or
authorized by these Guidelines, is the beneficial owner
of the property th$t is the subject of the permit.
11. "Tenants" shall mean persons and families who occupy a
residential rental unit for a period greater than 45
consecutive days.
1
12. "Eviction" shall include legal or court actions and
actions such as rent increases significantly above the
current market rate, avoidance of state mandated
maintenance, harassment and other such actions which
result in a tenant vacating his living unit against his
will.
III
ADMINISTRATIVE PROCEDURES FOR
CONVERSWNS AND DEMOLITIONS
3
The procedures for processing requests for the approval of
the conversion or demolition of residential structures located within
the Coastal Zone shall be made by the Developer to the Planning
Department on a form provide by that Department. The Developer shall
provide the following infortion as necessary:
a. The addless of the property for which approval is •
sought;'
b. A legal description of the property for which
approval is sought;
C. The number of residential units then in existence •
on the property;
d. The number of residential structures on site;
e. Description of the proposed new development;
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISiONgt'
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WIT IAN
THE COASTAL ZONE - Page 5
f. If the structure is being demolishejas a public
nuisance, a description of those f$ctors causing
the existing residential unit to constitute a
nuisance; i
i
g. The number of residential unit to be constructed
proposed;
h. If proposal is for a non- residential use, why the
residential use is no longed' feasible on the site;
i. The name, business addresg, residence address,
number of bedrooms, resi nce telephone number,
business telephone numbet, current monthly income,
and such other information that would assist the
City to verify financia& information of each
tenant then residing, do a permanent basis or for
more than 45 consecutive days, in structures
located on the property for which approval is
sought;
j. The name, business address, resident's address,
address from which evicted, number of bedrooms,
monthly income at,time of eviction, resident's
telephone number, business telephone number, and
such other information that would assist the City
to verify financial information as to each
evicted tenant and the court name, court address,
case number, case name, as well as all relevant
information, With respect to any legal action
filed by, or on behalf of, the Owner, the
Developer or agent thereof, and against any
current tenant or any person who, within the 12
months immediately preceding the date on which the
Application is filed, has resided, on a permanent
basis or fpr more than 45 consecutive days, within
any of th4 structures located on the property for
which the Application is filed;
k. Low and moderate income status shall be determined
by comparing the total income of the tenants to
the income found on the State of California Family
Eligibility and Affordability Income Limits Table,
promulgated in California Administrative Code,
Title 25, Part 1, Chapter 6.59 Subchapter 29
Section 69329 for Orange County at the moderate
income level for the number of tenants.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HQUSING WITHIN
THE COASTAL ZONE - Page 6
1. Such other information as the Planning Director
may consider necessary to the implementation of
these Guidelines or the provisions of State Law
relative to the conversion or demolition of
residential structures located within the coastal
zone, which are occupied;by low and moderate
persons.
M. Applications and permit' requests for proposed projects
shall not be deemed filed with the City until such
time as all information required by these
Guidelines has been provided to the Planning
Director.
n. Upon receipt of the Application and appropriate
fees, the Planning Director shall cause an inves-
tigation to be commenced to determine the follow-
ing:
M Whether the project is exempt under the
provisions of these Administrative
Guidelines;
ii) Whether any person of low or moderate
income is presently occupying any
residential unit located on the property
for which approval is sought;
iii) Whether any person of low or moderate
income has, within the 12 months immedi-
ately preceding the date on which the
Application is filed, occupied and been
evicted from, any of the residential
units on the property for which approval
is sought;
iv) The circumstances pursuant to which the
tenancy of any person of low or moderate
income was terminated during the 12
months immediately preceding the date on
which the application is filed;
v) With respect to property containing more
than one structure and, more than three
but less than 10 dwelling units whether,
given the circumstances of the project,
a requirement for replacement of units
occupied by low or moderate income
persons is feasible;
is
11
It
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISI1
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
THE COASTAL ZONE - Page 7
vi) In the event of a conversion or demoli-
tion of any residential structure for
purposes of a non - residential use which
is not coastally dependent, as defined
in Section 30101 of the Public Resources
Code, whether a residential use at that
location is no longer feasible.
2. The Planning Director, after conducting the inves-
tigation set forth above, shall notify Developer of the determination
and Developer's rights to appeal, by certified mail.
3. Upon final determination as to the number of replace-
ment units to be provided by Developer, Developer shall provide the
Planning Director, on a form to be prepared by the Planning
Department, of the following information:
a. Whether replacement units shall be made available
through new construction, conversion of
non - residential structures to residential use,
substantial rehabilitation of substandard dwelling
units (as defined in 417910 et.seq. of the Health
and Safety Code) through the provision of existing
units not currently affordable by low or moderate
income perlons, by giving existing low and
moderate income tenants the right to lease units
on -site at affordable rates, or by any combination
of the above;
b. The location of the replacement units and, if
those units are not located within the Coastal
Zone, all of the facts and circumstances upon
which the Developer relies to support his or her
contention that it is not feasible to provide
repl4kement units within the Coastal Zone;
C. Info;tmation relative to the size, configuration
and'manner of construction of the units, and
togkther with all other information as to the
amgnities found within the replacement units.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN •
THE COASTAL ZONE - Page 8
4. The Planning Department shall conduct an investigation
to determine the suitability of the replacement units and shall
approve the replacement units if:
a. The replacement units provide housing oppor-
tunities similar to those provided by the dwelling
units converted or that aze demolished;
b. The number of replacement units is equal to the
number of dwelling Unit$ proposed for conversion
or demolition, which alk occupied by persons or
families of low or mod rate income, or were
occupied by persons o families of low or moderate
income who were evictid within the past 12 months;
5. Upon a final determination as to the number and lo-
cation of replacement units, and prior t¢ or concurrently with, giving
the approval to Developer, to convert or,demolish the units, Developer
and the City shall enter into an Agreem t, prepared by Developer and
approved as to form by the City AttorneJ, which shall include the
following provisions: i
s
a. A description of tke project, including its
location and the number of units to be developed,
if the property is to be developed for residential
purposes;
b. A description ofhe replacement units to be
provided, apecif ng their size, number and
location;
C. A commitment that the replacement units are
affordable, and ill be made available to, persons
or families of ow or moderate income;
d. That the repement units shall be provided, and
available for occupancy, within three years from
the date upo which the approval for the conver- •
sion or demolition was granted;
e. A statement as to whether the affordable units are
to be sold or rented;
f. A provision that the Agreement be recorded against •
the property containing the replacement units.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
THE COASTAL ZONE - Page 9
g. A provision that the Developer is respghsible for
ensuring that the persons or families Who rent or
purchase the units are properly qualified as
persons or families of low or moderate income;
h. A provision that a fair and equitAble process
shall be used by the Developer to select the
persons or families entitled to 'rent or purchase
the units. The selection process shall, at a
minimum, provide for the follgaing:
i) That the Developer advertise the
availability of the affordable units;
11) That the Developer allow a reasonable
period of time for persons or families
to apply for purchase of rental of the
affordable unfits;
iii) That the Developer diligently
investigate the facts contained in the
application submitted to ensure that the
Developers,are in fact persons and /or
families of low or moderate income;
iv) That selection of the purchasers or
renters shall be made through a random
system such as a lottery.
i. A provision that, in the event of the sale or
rental of a unit to a person or family who does
not qualify as low or moderate income, the Devel-
oper shall, within 60 days, either replace the
occupants with persons or families of low or
moderate income or provide a replacement unit,
similar in size and related characteristics to the
one sold or rented to the person or family who
does not qualify.
J. A provision that the Developer enter into an
agreement with the purchaser or renter of an
affordable unit which agreement shall:
i) Obligate the purchaser or renter at
least once a year, to provide the
Developer with income information; and
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
THE COASTAL ZONE - Page 10
ii) Give the Developer the right, in the
event of a material misrepresentation
made by a person or family with respect
to income, either invalidate the sale of
the affordable unit or, in the event of
a rental unit, the right to terminate
the tenancy.
iii) Require that a "for sale" unit be sold,
within the period of time during which
the unit is to remain affordable, only
to persons of low or moderate income,
whichever is appropriate;
iv) Provide the agreement be recorded.
k. A provision that Developer, and all succes-
sors-in- interest, maintain the units as affordable
for at least ten (10) years from the date on which
the units are first available for occupancy,
unless the developer can demonstrate to the City
Council that a shorter period of affordability is,
given the circumstances of the project,
appropriate. Any agreement that provides for a
period of affordability of less than ten (10)
years shall be reviewed and approved by the City
Council.
1. A provision that the City shall be entitled to
recover reasonable attorney's fees and costs
incurred in connection with enforcement of any
provision of the agreement.
M. A provision that the terms and conditions of the
agreement shall be binding on the agents, employ-
ees, heirs and assigns and successors -in- interest
of the Developer.
n. A provision requiring the Developer, and succes-
sors-in- interest, to annually submit to the
Planning Director a schedule of the rental rate
for each affordable unit. The Developer shall
also provide the Planning Director with the gross
income of the occupant of the affordable unit.
o. A provision that the City, in the event of a
breach of the agreement by the Developer, is
entitled to obtain an order of the Superior Court
commanding the Developer to specifically perform
in accordance with the agreement, as well as
interim injunctive relief restraining further
violations of the agreement.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
THE COASTAL ZONE - Page 11
IV
ADMINISTRATIVE PROCEDTjRES FOR
PROCESSING NEW DEVgOPMENTS
WITHIN THE COASTAL ZONE
In the event that a new hating development is proposed
within the Coastal Zone, the procedures set forth shall apply;
1. The Planning Director shall determine whether the proposed
project is exempt from these Guidelines as provided above;
2. If the project is determined not to be exempt from the
provisions of these Guidelines, the Planning Director shall advise the
Developer of the requirements of these Guidelines and, in the eventisthattheproposedprojectisonewhichrequiresanapprovalbythe
Planning Commission, the project, including the Development Permit,
shall be referred to the Planning Commission of the City for review
and decision;
3. The Planning Director, or the Planning Commission in the
case of a project requiring Commission approval, shall determine the
feasibility of requiring the inclusion of dwelling units affordable by
persons or families of low or moderate income within the project and
on the project site. If it is determined not to be feasible to
provide low and moderate income housing on site, the Planning
Director, or the Planning Commission where appropriate, shall
determine whether it is feasible to provide such housing at another
location within the City, and within the Coastal Zone, or within three
miles of the Coastal Zone boundary;
4. In evaluating the feasibility of providing affordable units
as a part of a new housing development, and in determining the number
of affordable units to be provided once a determination of feasibility
has been made, the Planning Commission, or Planning Director, shall
consider the following factors:
a. The number of units proposed to be constructed;
b. The number of affordable units and the affordability
mix shall be determined consistent with the provisions
of the Housing Element, but shall not exceed the
moderate annual income level as stated in the
definition of "affordable units" contained herein;
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN •
THE COASTAL ZONE - Page 12
C. The provisions of the ordinances, resolutions and
policies of the City which peptain to affordable
housing; ;
d. The extent to which the project proponent or Developer
has requested density bonus¢s, the waiver of fees, the
waiver of park credits, or imilar action on the part
of the City as incentives provide affordable
housing; f
e. The social, technical, ec omic, environmental and
other information related to project, the construction
of affordable housing, an the mitigation measures
necessary to minimize any adverse environmental
impacts.
5. When a proposed new developme t is required to provide
housing units affordable by persons or amilies of low or moderate
income ( "Affordable Units "), the Develo er shall enter into an Agree-
ment with the City which shall include he following provisions: 9
a. A description of the prqject, including its location
and the number of units to be developed, if the
property is to be devel ped for residential purposes;
b. A description of the affordable units to be provided,
specifying their size, umber and location;
C. A commitment that the affordable units are and will be
made available to, per ons or families of low or
moderate income; ,
t
d. That the affordable units shall be provided, and
available for occupancy, within three years from the
date upon which the approval for the conversion or
demolition was granted;
e. A statement as to whether the affordable units are to •
be sold or rented;
f. A provision that the Agreement be recorded against the
property containing the affordable units;
g. A provision that the Developer is responsible for •
ensuring that the persons or families who rent or
purchase the units are properly qualified as
persons or families of low or moderate income;
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
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h. A provision that a fair and equitable process shall be
used by the Developer to select the persons or families
entitled to rent or purchase the units. The selection
process shall, at a minimum, provide for the following:
i) That the Developer advertise the availability
of the affordable units,;
ii) That the Developer allow a reasonable period
of time for persons of families to apply for
purchase or rental of the affordable units;
iii) That the Developer diligently
investigate the facts contained in the
application submitted to ensure that the
Developers are in'fact persons and /or
families of low or moderate income;
iv) Selection of the purchasers or renters shall
be made through'a random system such as a
lottery.
i. A provision that, in the event of the sale or rental of
a unit to a person or family who does not qualify as
low or moderate income, the Developer shall, within 60
days, either replace ,the occupants with persons or
families of low or moderate income or provide a
replacement unit, si,6iilar in size and related
characteristics to phe one sold or rented to the person
or family who does trot qualify.
i
J. A provision that the Developer enter into an agreement
with the purchase{ or renter of an affordable unit
which agreement stall:
i
i) Obligate the purchaser or renter at least
once S year to provide the Developer with
income information; and
ii) Givejthe Developer the right, in the event of
a ma #erial misrepresentation made by a person
or family with respect to income, either
inv #lidate the sale of the affordable unit
or,;in the event of a rental unit, the right
to ?terminate the tenancy.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
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iii) Require that a "for sale" unit be sold,
within the period of time during which
the unit is to remain affordable, only
to persons of low or moderate income,
whichever is appropriate;
iv) Provide the agreement be recorded.
k. A provision that Developer, acid all
successors -in- interest, maintain the units as
affordable for at least ten '(10) years from the date on
which the units are first a4ailable for occupancy,
unless the Developer can d onstrate to the City
Council that a shorter perlod of affordability is,
given the circumstances of;the project, appropriate.
Any agreement that provid s for a period of
affordability of less tha ten (10) years shall be
reviewed and approved by he City Council.
1. A provision that the Cit shall be entitled to recover
reasonable attorney's f s and costs incurred in
connection with enforce ent of any provision of the
agreement.
M. A provision that the t rms and conditions of the
agreement shall be bin in on the agents, employees
heirs, assigns and successors -in- interest of the
Developer. f
n. A provision requiringjthe Developer, and
successors -in- interest, to annually submit to the
Planning Director a schedule of the rental rate
for each affordable rental unit. The Developer
shall also provide the Planning Director with the
gross income of the occupant of the affordable
unit.
o. A provision that the City, in the event of a breach of •
the agreement by the Developer, is entitled to obtain
an order of the Superior Court commanding the Developer
to specifically perform in accordance with the
agreement, as well as interim injunctive relief
restraining further violations of the agreement.
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ADMINISTRATIVE GUIDELINES FOR THE IMPLEMENTATION OF THE PROVISIONS
OF STATE LAW RELATIVE TO LOW AND MODERATE INCOME HOUSING WITHIN
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V
APPEALS
1. Determinations of the Planning Director or Planning
Commission, pursuant to this policy and these Guidelines, shall be
final 10 days after notice is given. Written notice shall be deemed
to have been given if a letter advising the Developer of the deter-
mination is deposited in the U.S. mail, first - class, postage pre -paid,
and addressed to Developer at the business or residence for Developer
shown on the application for permit.
2. At any time prior to the date on which the determina-
tion becomes final, a Developer may file, with the City Clerk of the
City, a notice of appeal, which must contain the facts and circum-
stances regarding the action or determination that is the subject of
the appeal, as well as all of the contentions upon which the Developer
intends to rely at the time the appeal is heard.
3. Within 10 days from the date on which the City Clerk
receives a valid notice of appeal, the Clerk shall notify the Develop-
er, in writing, of the time and place set for the hearing of the
appeal. The hearing shall be scheduled within 60 days from the date
on which the notice of appeal was filed.
4. The City Council may hear the appeal, or the City
Council may delegate the responsibility for conducting the hearing, to
a hearing officer, who shall conduct the hearing, receive all relevant
evidence, and who shall prepare and submit to the City Council written
findings and recommendations. The City Council shall, within 30 days
from the date on which the hearing is held, or within 30 days from the
date on which written findings and recommendations are received from
the hearing officer, render its decision on the appeal.
0
Adopted - August 9, 1982
Amended - September 12, 1983
Amended - December 9, 1985