Dale Goldsmith | Mark Armbruster | William F. Delvac | Amy E. Freilich | David A. Goldberg
Damon P. Mamalakis | Dave Rand | Todd Nelson | Daniel Mandel | Spencer Eldred
Aaron Clark | Matt Dzurec | Alix Wisner
The California Coastal Commission Leads the Charge in Promoting Housing....Through Denying Projects
The Commission Rejects Two South Bay Single Family Home Projects That Would Replace Existing Multiplex Housing
By David A. Goldberg
_______While the State legislature and local jurisdictions continue to make little progress towards addressing a housing crisis of existential proportions, the California Coastal Commission has suddenly stepped to the fore to aggressively promote housing. And it’s doing it one dwelling unit at a time. And by denying projects. Confused yet? You’re not alone; so were the applicants whose projects were denied. 
_______At its meeting in November 2020, the Coastal Commission denied two South Bay single family home projects – one in Hermosa Beach and one in Manhattan Beach – because each would result in a net loss of housing by replacing multiplexes with single family homes. Although the Commission reviewed both projects through the same “no net loss” of housing lens – despite lacking authority to enforce State housing law – and both projects shared the same ultimate fate of a denial, their facts were quite different.  
Hermosa Beach – Replacement of Duplex with Single Family Home + ADU
_______In the Hermosa Beach matter (No. 5-20-0205), the Applicant OFIPLEX, LLC sought to replace an old duplex with a shiny new duplex. Had their proposal been that straightforward, it appears they would be onto pulling building permits right now. However, to expedite City approval, the applicant took advantage of the ministerial approval process afforded under AB 68, effective as of January 1, 2020, applicable to the construction of a new single family home with an Accessory Dwelling Unit (“ADU”), and characterized one of the units in the duplex as an ADU. That decision ultimately would prove costly.
_______While the City swiftly granted local approval, because Hermosa Beach does not have a certified Local Coastal Program, the applicant had to apply directly to the Coastal Commission for its coastal development permit. Coastal Commission staff recommended approval of the project, but its support was tepid and not without hesitation. Staff’s primary concern was the loss of housing and that a single family home with an ADU was not a like for like replacement for a duplex, since there was no guarantee the ADU would be rented. However, staff stated it represented a compromise approach the Commission had found acceptable in the past. In response to concerns that the ADU might not be actually rented, but rather used as part of the single family home, Commission staff recommended conditions of approval requiring removal of an interior door between the units and that the home and ADU be maintained on the site.
_______While the seriousness with which the Commission approached the “no net loss” of housing is commendable, its approach represented a complete about face from its prior approach to similar projects. Indeed, the staff report noted that, since 2014, it had approved 40 projects involving the conversion of multi-family structures to single-family residences in Hermosa Beach (for a total loss of 45 residential units). In analyzing the loss of housing issue, the staff report stated that:
_______[M]any [of the Commission’s prior] decisions did not look at the cumulative
_______impacts of loss of housing density in coastal areas or the importance of
_______concentrating development in areas capable of supporting it for purposes of
_______protecting coastal resources on a broader scale. In response to California’s
_______persisting housing crisis, however, the Commission has become increasingly
_______concerned about the cumulative impacts of development trends that reduce
_______housing density and increase development pressure in other, potentially
_______sensitive or hazardous areas in the coastal zone.
_______The staff report further cobbled together a rationale for not leaving any housing units on the table by emphasizing that the “Coastal Act encourages the protection of housing opportunities for individuals of low and moderate incomes (PRC 30604), as well as the concentration of development in already developed areas that can accommodate it (PRC 30250) and the minimization of vehicle miles traveled (PRC 30253(e)).” 
Nevertheless, as noted, the staff report recommended approval of the project as a compromise approach.
_______The Commissioners were not as forgiving. They were skeptical the ADU would ever be rented and were suspicious it might be used as only a short-term rental. They were, therefore, not persuaded that replacing a duplex with a single family home and an ADU reflected a “no net loss” in housing, even though that is not the standard of review under the Coastal Act. Although the Commission had previously approved other similar projects and its staff delivered well-supported, tried and true Coastal Act findings to it on a silver platter, the Commission voted to deny the project, rejecting both the staff recommendation and years of its own precedent in one fell swoop. 
Manhattan Beach – Replacement of Triplex with Single Family Home
_______In the Manhattan Beach case (A-5-MNB-20-0020 & A-5-MNB-20-0041), the City granted a CDP to the Applicant Corinna Cotsen for the demolition of a single family home and triplex on adjoining lots, the merger of those two lots and the construction of large single family home spanning the merged lot. The project seemed so incredibly basic. The proposed home met all objective standards in the City’s certified Local Coastal Program (LCP) and, as emphasized by the Applicant’s representative, was no different than 53 prior City approvals since 2001 where a home replaced multiple units, including five that involved lot mergers, none of which were appealed by the Coastal Commission. 
_______Unfortunately for the Applicant, like another Zone made famous by Rod Serling in his acclaimed 1960s black and white sci-fi anthology, things are not always as they seem in the Coastal Zone. Citing a concern that the loss of three housing units was not consistent with the City’s LCP and bucking nearly twenty years of its own precedent, two Coastal Commissioners appealed the City’s approval. Unsurprisingly, Commission staff then recommended denial of the CDP. 
_______A major source of disagreement between the Applicant and Commission staff was whether the lots’ Residential High-Density (RH) land use designation under the LCP just permitted or actually required high-density housing. Commission staff acknowledged that the property’s high-density zoning allowed single family housing, which it could not ignore in that the LCP stated as such explicitly. Nonetheless, it asserted that the lot merger “essentially circumvents the density requirements prescribed by the RH designation in the certified LCP to allow 0.5 units on the current (prior to merger) lots, instead of one, thereby achieving a lower density than is specified by the Commission-certified LCP and originally planned for in this area.” Staff also argued the project was inconsistent with a purported intent of the RH zone to promote multifamily buildings, although it provided no citation to the LCP for this assertion. As the Applicant’s representative argued with exasperation in its written submissions and at the hearing, it is difficult to square this position with the property’s zoning allowing single family homes and not prohibiting the subject lot merger.
_______The balance of the staff report reflected staff’s pursuit of a result-oriented approach to avoid the loss of housing units in the City, noting that “the project is part of a broader trend in development that is eliminating density in an area of Manhattan Beach specifically set aside in the LCP for more concentrated development.” A key excerpt from the staff report summed up Commission staff’s position on the matter and should serve as a cautionary note to similar project proposals in the future:
_______[The Housing Crisis Act (SB 330)] is relevant because projects resulting in
_______a loss of housing units and density potential, such as the case here, have
_______significantly contributed to the current housing shortage in the state,
_______which compelled the Legislature to enact housing laws such as SB 330.
_______The Housing Crisis Act and other recently adopted housing laws are
_______reflective of a statewide policy to encourage and increase housing
_______throughout the state, which may impact coastal resources in the coastal
_______zone if it is not well-planned or undertaken with coastal resource protection
_______in mind. Thus, while not a standard of review, it’s important to consider the
_______current housing situation and the high density designation of the subject lots
_______when considering whether the proposed development is consistent with the
_______intent of the high-density designated lots. (Emphasis added.)

_______At the hearing, Commission staff defended its position in breaking with two decades of its own precedent by noting that land use policy is ever-evolving in response to new issues – in this case the State’s housing crisis – and did not spend much time defending what the Applicant described as a strained interpretation of the LCP. It wasn’t necessary to do so. The Commissioners were primed to deny the Project from the get-go, finding that while the Project might be consistent with the LCP, it is not the preferred outcome. After very little discussion, the Commission unanimously voted to deny the Project.
Takeaways, Trends and Reminders
_______The primary takeaway from these two cases is that the Coastal Commission is now pursuing a hardline approach to protect against housing loss in the Coastal Zone. Whether the motivation is in fact related to combatting the State’s housing crisis, preserving a community’s character (however that is defined) or discouraging single family homes in favor of multifamily housing to expand access to the coast for as many people as possible remains to be seen. It will be interesting to see if the Commission approaches larger housing developments, which might present a greater potential for impacts to coastal resources, with the same pro-housing deference.
_______A trend worth noting, at least with respect to the Hermosa Beach case, is that the Commission has been far more willing over the last couple years to take even stricter positions than its staff and deny projects, even with favorable staff recommendations and even where there is little to no project opposition. Applicants can no longer rest on their laurels when receiving recommendations for project approval.  
_______These two cases also serve as a sober reminder that the Coastal Commission can and often does break from its own precedent either to adopt a stricter interpretation of the Coastal Act or, as the case here, to respond to other evolving land use issues. Once the Commission adopts a new Coastal Act interpretation or policy, it can immediately form new precedent, which the Commission and its staff then follow as if it had been an established position for years. This is important to keep in mind when advocating that the Commission follow precedent favoring the applicant’s Project. If that precedent does not jibe with the Commission’s current position, its response may very well be, as was the case in these South Bay projects, “why keep repeating mistakes of the past?” It is no wonder the Commission seems to be so often defending its denials in court.
We are Here to Assist
_______Our attorneys and planners have substantial experience processing approvals under the Coastal Act before both local jurisdictions and the California Coastal Commission. If you require assistance with a Coastal law matter or have questions regarding the issues addressed in this article, please contact the head of AGD’s Coastal law practice, David Goldberg, at [email protected]