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City Officials Caught Off Guard by Flurry of Development Submissions


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By Jorge Casuso

October 13, 2022 -- Santa Monica's biggest housing provider has rushed plans into the City's development pipeline to build more than 4,000 units that require little public input, dealing a massive blow to local slow-growth activists who were caught off guard by the move.

The City Council's failure to submit a compliant Housing Element to State officials by last year's October deadline paved the way for WSC and NMS Properties to submit plans over the past several weeks to build 11 mostly high-rise buildings that bypass the City's zoning code and general plan.

The proposed projects, as well as another by a different developer, add a total 3,968 units, 829 of them affordable. About half would be in a 15-story residential tower at 330 Nebraska Avenue with 1,600 market rate units and 400 affordable units.

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Attorney Dave Rand, who represents NMS and WSC, said plans for two more projects were turned in on Thursday before the final deadline on Saturday for the City to submit the revised Housing Element approved by the Council Tuesday.

Mayor Sue Himmelrich sees a positive side to the proposals, which include 20 percent affordable housing and have alarmed slow-growth activists and been celebrated by housing advocates.

"If I don't sound as upset, it's because these (proposed projects) have more affordable housing than anything we (the City) could do," Himmelrich said. "If you don't mind affordable housing, it's not as horrible as they say."

The developers' rush to meet Friday's filing deadline caught Councilmember Phil Brock, who leads the slow-growth Change faction on the Council, by surprise.

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

Brock said he only learned on Thursday about the "builder's remedy" provision in State law that allows developers of projects with 20 percent of the units affordable to lower-income households to bypass the City's zoning laws if the Housing Element is not in compliance.

Some slow-growth activists have "searched reports for housing (issued) for the last ten months and nobody has mentioned the 'builder's remedy,'" Brock said. "It was a non issue."

Mayor Himmelrich counters that the Council had been informed by City staff of the provision in the State's Housing Accountability Act (HAA) and the consequences of failing to submit a certified Housing Element.

"We knew about the developer's remedy," she said. "We knew that it was a possibility they would be able to do that. All the cities knew the biggest weapon were these developer remedies."

Ironically, the developers' use of the "builder's remedy" is the direct result of the Council's efforts to rely on non-profit housing providers using City-owned land and homeowners adding auxiliary rental units to meet its State-mandated housing quota ("Council Cautiously Approves Housing Plan," October 13, 2021).

The five Council members who approved the Housing Element last October -- including Himmelrich and Brock -- were trying to avoid relying on private developers that provide "inclusionary units" in large market-rate projects.

The plan -- which was opposed by Councilmembers Gleam Davis and Kristin McCowan -- backfired.

In February, the Department of Housing and Community Development (HCD) found that the Housing Element the City submitted was not in compliance and gave it until October 15 to comply ("City's Housing Element Fails to Comply," February 11, 2022).

Rand, whose advice became highly sought by developers this week after counseling NMS and WSC, said City staff members have repeatedly advised the Planning Commission and City Council about the consequences of not complying, although the colloquial term "builder's remedy" was not used.

"Staff has addressed this every step of the way that this is a consequence," said Rand, a land use attorney with Rand Pastor & Nelson LLP. "This consequence has been at the top of the list. There were absolutely warnings."

Rand said the projects submitted by NMS and WSC, if approved, will give a major boost to Santa Monica's efforts to build affordable housing, although only the initial step has been taken.

"This is a huge amount of affordable housing," he said. "It's a huge dent that doesn't require a huge subsidy and public land. It's a massive public benefit."

Rand noted that although the proposed projects are not in the Coastal Zone, which requires a much more onerous approval process, the projects still have a long way before they can be built.

"If these are to be built, there's a lot that has to happen," Rand said. "For those that are concerned, the sky is not falling."

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