The URL can be used to link to this page

Home My WebLink About12 - Call for Review of Planning Commission's Approval of a Mixed -Use Project at 2510 West Coast Highway (PA2019-249) - Correspondence - ApplicantII COX CASTLE N ICHOLSON July 23, 2021 VIA E-MAIL[CITYCOUNCIL@NEWPORTBEACHCA.GOV] Mayor Avery and Honorable Council Members City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 Received After Agenda Printed July 27, 2021 Item No. 12 File No. 088441 Re: 2510 West Coast Highway Mixed Use Project (PA2019-249) Mayor Avery and Honorable Council Members: I write on behalf of the applicant for the proposed mixed -use development ("Project") at 2510 and 2530 West Coast Highway ("Property"). The purpose of this letter is twofold. First, I want to update the Council with respect to the multitude of design and other changes made by the applicant since the Council last considered the Project on April 27, 2021. Second, I want to remind the Council of its legal obligations under the Housing Accountability Act ("HAA"), and of the consequences associated with its violation. 1. Proiect Design Changes The clear message coming out of the Project's April 27th hearing was the need to reconsider the Project's design. To that end, the applicant has proposed extensive Project changes in its most recent submittal, including the following: Nautical Architecture — The Project's original `California Coastal Modern' architecture has been set aside in favor of a more `nautical' design theme reminiscent of the Lido House hotel. The new design includes substantial building articulation with exterior balconies, trellises, planter boxes and landscaped open spaces. Contrasting finish colors and materials also add visual interest. Authentic Building Materials — The Project's exterior finishes have been updated to no longer include "wood look" materials for any siding, instead using wood siding with the same color scheme. Other exterior finish materials include horizontal and vertical siding, pour -in -place concrete, and metal standing -seam roofs. www.coxcastle.com Los Angeles I Orange County I San Francisco Mayor Avery and Honorable Council Members July 23, 2021 Page 2 • Improved Views from John Wayne Park — Relative to the original project, the narrower footprint of the new residential structure results in additional view corridors through the property from John Wayne Park. At staff s request, visual simulation consultant Brent Chase of Visual Impact Group submitted a document to the City detailing the methodology used to ensure the accuracy of his firm's visual simulations. Mr. Chase will be available to respond to the Council's questions at the July 27th hearing. • Increased Side Setbacks — The residential portion of the Project has been extensively modified to remove the central courtyard and situate the housing units along two sides of a singular interior corridor. Relative to the original project, this design results in a much narrower building with usable outdoor tenant amenity spaces along both sides of the residential structure. • Reduced Commercial Use — The Project's commercial component has changed from a 11,266 square foot boutique auto showroom to a 5,096 square foot office building. This change was enabled by use of the incentives and concessions allowed under the City and State's Density Bonus Law. • Code -Compliant Parking — Even though the size of Project's commercial use has been reduced by over 50%, the Project's total parking stalls have actually increased from 58 to 65. The office building is parked to City Code (i.e., 1/250 square feet) and no parking waiver has been requested. There will be five surplus parking spaces on site for use by commercial or residential guests. In addition, the Project's 21 commercial parking spaces will be available to residential guests outside of commercial business hours. • Proposed Avon Dedication — Finally, the applicant has volunteered a new condition of approval that dedicates between 12' and 26' along the Project's Avon frontage. This dedication will allow the City to redesign and reconstruct Avon in a way that aligns the offset Avon /Tustin intersection, improves circulation, creates an additional buffer from residences on Tustin Avenue, and results in additional public parking spaces relative to what exists today. 2. Housing Accountability Act The Project is still covered by the Housing Accountability Act. We wrote previously wrote a letter, dated February 1, 2021, regarding how the HAA prohibits the City from denying the Project or conditioning its approval on lower density. We write again to reiterate the narrow scope of the City's discretion over the Project and stiff penalties if the City violates the HAA. Mayor Avery and Honorable Council Members July 23, 2021 Page 3 a) The City Can Require the Project Meet Only Applicable Objective Standards and Cannot Reject the Project For Subjective Reasons The HAA "significantly limits the ability of a local government to deny an affordable or market -rate housing project that is consistent with planning and zoning requirements." (Department of Housing and Community Development ("HCD"), Housing Accountability Act Technical Assistance Advisory ("HCD HAA Advisory") (Sept. 15, 2020) at p. 51; see N. Pacifica, LLC. v. City of Pacifica (N.D. Cal. 2002) 234 F.Supp.2d 1053, 1059-60, aff d N. Pacifica LLC v. City of Pacifica (9th Cir. 2008) 526 F.3d 478 [The HAA "imposes mandatory conditions limiting the City's discretion to deny the permit"].) For example, the HAA "limits the application of conditions that lower the residential density of the project." (HCD HAA Advisory at p. 10.) The HAA also prevents local governments from denying a project based on failure to meet subjective standards. (Gov. Code, § 65589.50)(1).) A project that complies with "applicable, objective general plan, zoning, and subdivision standards and criteria, including design review standards, in effect at the time that the application was deemed complete" can be denied or conditioned on lower density only if the project would have "a specific, adverse impact" on public health and safety and there is "no feasible method to satisfactorily mitigate" that impact other than disapproval or approval at a lower density. (Id.) A "specific, adverse impact" means "a significant, quantifiable, direct, and unavoidable impact, based on objective, identified written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete." (Id.) Such impacts "arise infrequently" (§ 65589.5(a)(3)) and must be supported by "a preponderance of the evidence" (§ 65589.50)(1)). The City has not identified any public health or safety issues with the Project. The City also has not identified any objective standards that the Project fails to meet. (See § 65589.50)(2)(A)(i).) Where a local government "fails to provide the required documentation" explaining its reasons for considering a housing development project is inconsistent with an objective standard, "the housing development project shall be deemed consistent, compliant, and in conformity with the applicable plan, program, policy, ordinance, standard, requirement, or other similar provision." (§ 65589.50)(2)(B).) The HAA defines "objective" as "involving no personal or subjective judgment by a public official and being uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official." (Gov. Code, § 65589.5(h)(8).) Examples of an objective standards include height limits, minimum setbacks, and minimum residential unit size requirements. Non-objective standards include policies that require interpretation such as, "[d]esign should respect and `fit in' to its surroundings" and "[r]oofs and roof elements should respond to views from above." (Mariner's Mile Strategic Vision & Design Framework, Objectives 5.11(a), (b).) Similarly, General Plan Policy NR 20.1, which states "[p]rotect and, where feasible, enhance significant scenic and visual 'Available at htips://www.hcd.ca.,gov/community-development/housing-element/housin,g-element- memos/docs/hcd-memo-on-haa-final-sept202O.pdf Mayor Avery and Honorable Council Members July 23, 2021 Page 4 resources ... from public vantage points," is not objective because it involves discretion to determine when protection is feasible and which resources are significant.2 In addition, mitigation fees are not objective planning standards. (Ruegg & Ellsworth v. City of Berkeley (2021) 63 Cal.App.5th 277, 325.) Likewise, vague concerns about cumulative traffic impacts and potential necessary roadway improvements are not objective standards. (Id. at p. 328.) Further, "the receipt of a density bonus," including incentives, concessions, waivers, and reduced parking standards under State Density Bonus Law "shall not constitute a valid basis on which to find a proposed housing development project is inconsistent, not in compliance, or not in conformity, with an applicable plan, program, policy, ordinance, standard, requirement, or other similar provision." (Gov. Code, § 65589.50)(3).) Accordingly, the Project's use of a density bonus, parking reductions, incentives, and waivers to which it is entitled under State Density Bonus Law do not prevent it from meeting all applicable, objective standards. (See Wollmer v. City of Berkeley (2011) 193 Ca1.App.4th 1329, 1349 [describing how State Density Bonus Law makes certain general plan and zoning requirements inapplicable].) b) Violation of The Housing Accountability Act Results in Severe Penalties The HAA imposes stiff penalties on cities for failure to comply with its requirements. Under the HAA, the project applicant, people eligible to live in the proposed project, or a housing organization all have standing to sue a city for impermissibly denying or conditioning a project. (Gov. Code, § 65589.5(k)(1)(A).) If a court finds a city violated the HAA, the court must issue an order compelling that city to comply with the HAA within 60 days. (Id.) The court also "shall award reasonable attorney's fees and costs of suit to the plaintiff or petitioner, except under extraordinary circumstances in which the court finds that awarding fees would not further the purposes" of the HAA. (Id.; see § 65589.5(k)(2) [must award attorneys' fees to a prevailing housing organization].) If the city fails to comply with the initial order within 60 days, the "court shall impose fines" of at least $10,000 per housing unit in the housing development project on the date the application was deemed complete and take further action to ensure the city complies with the HAA. (§ 65589.5(k)(1)(B), (Q.) And if the court finds a city acted in "bad faith" when illegally disapproving a housing development project or conditioning it on lower density, the court must multiply the fine by a factor of five. (§ 65589.5(1).) After the trial court enter its order, a local government must post a bond, in an amount determined by the trial court, to the benefit of the plaintiff if the plaintiff is the project applicant. (§ 65589.5(m).) The trial court's bond determination in the action of 40 Main Street Offices, LLC v. City of Los Altos, Santa Clara Superior Court case number 19CV349845 is informative. That case concerned a project that would have 15 dwelling units and 5,724 square feet of office space. There, 2 The Housing Crisis Act reinforces the narrowness of the City's review. Under the Housing Crisis Act, an affected city, such as the City, cannot take the act of "[i]mposing or enforcing design standards established on or after January 1, 2020, that are not objective design standards." (Gov. Code, § 66300(b)(1)(C).) Mayor Avery and Honorable Council Members July 23, 2021 Page 5 the trial court concluded that Los Altos violated the HAA, State Density Bonus Law, and the ministerial streamlining provided by Senate Bill 35 and ordered Los Altos to "rescind its decision to deny and instead approve and permit the project at the requested density." (Order Granting Petitioners for Writ of Mandate, Case No. 19CV349845 (Apr. 2020).) Rather than rescind, Los Altos appealed the order, but did not ask the court to set a bond or reach an agreement with the petitioner regarding the bond amount. After receiving petitioner's motion to set a bond on appeal, the court ordered that Los Altos post a $7 million bond within ten days. (Order Setting Amount of Bond on Appeal, Case No. 19CV349845 (Sept. 2020).) In short, unlike an action under the California Environmental Quality Act or State Planning and Zoning Law, an action under the HAA (and State Density Bonus Law) can result in orders directing a city to approve a project, significant monetary awards, and the need to post large bonds to proceed with an appeal. The Project deserves this Council's support because it is consistent with, and implements, the City's planning documents for Mariner's Mile. More than that, the Council should approve the Project because this applicant has gone to extraordinary lengths to comprehensively modify the Project in response to largely -aesthetic concerns. And if those reasons are not enough, we are compelled to remind the Council of its obligations under State housing law. The HAA exists in its current form because "California's housing picture has reached a crisis of historic proportions despite the fact that, for decades, the Legislature has enacted numerous statutes intended to significantly increase the approval, development, and affordability of housing for all income levels, including [the HAA]." (Gov. Code, § 65589.5(a)(2)(J).) The state legislature expressly stated that in strengthening the HAA, its intent "was to significantly increase the approval and construction of new housing for all economic segments of California's communities by meaningfully and effectively curbing the capability of local governments to deny, reduce the density for, or render infeasible housing development projects and emergency shelters." (§ 65589.5(a)(2)(K) [emphasis added].) While you may not like the law, you must follow it. Sincerely, Sean Matsler of COX, CASTLE & NICHOLSON, LLP cc: Matthew Schneider, mschneider@newportbeachca.gov Mark Moshayedi, mark@spaceip.com 088441\13001849v2