City of Hermosa Beach - File #: REPORT 23-0374

File #:

REPORT 23-0374 Version: 1

Name:

Type:

Action Item

Status:

Consent Calendar

File created:

6/22/2023

In control:

City Council

On agenda:

7/11/2023

Final action:

Title:

ADOPTION OF AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HERMOSA BEACH, CALIFORNIA, AMENDING CHAPTER 12.16 OF THE HERMOSA BEACH MUNICIPAL CODE ESTABLISHING AN OUTDOOR DINING PROGRAM AND MAKING PROCEDURAL CHANGES TO THE ISSUANCE AND RENEWAL OF ENCROACHMENTS IN THE CITY AND DETERMINING THE ORDINANCE TO BE EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT ("CEQA") (Environmental Programs Manager Doug Krauss)

Attachments:

Staff Report Text

Honorable Mayor and Members of the Hermosa Beach City Council

Regular Meeting of July 11, 2023

Title

(Environmental Programs Manager Doug Krauss)

Body

Recommended Action:

Recommendation

Staff recommends City Council:

1. Waive second reading and adopt by title only an Ordinance of the City of Hermosa Beach, California, amending Chapter 12.16 of the Hermosa Beach Municipal Code establishing an outdoor dining program and making procedural changes to the issuance and renewal of encroachments in the City and determining the ordinance to be exempt from the California Environmental Quality Act (“CEQA”) (Attachment 1); and

2. Direct the City Clerk to publish a summary ordinance.

Body

Executive Summary:

At its December 14, 2021 meeting, City Council provided staff with direction to develop long-term versions of the temporary outdoor dining and downtown lane reconfiguration programs that were created in response to the COVID-19 pandemic. Council subsequently extended the temporary program through May 1, 2023 with direction to staff to bring the elements of the program to Council before that date.

Some of the final elements necessary to establish the long-term program were presented for Council’s approval at its April 25, 2023 meeting. Final elements included an ordinance amending Chapter 12.16 (Encroachments) of the Hermosa Beach Municipal Code, a resolution revising existing operational and design guidelines for Pier Plaza and other off-street encroachments, a resolution for new encroachment fees, and accompanying CEQA determinations. At the meeting, Council approved a resolution establishing the lane reconfigurations and provided suggestions on the other elements. At its June 13 meeting, Council approved revised versions of the remaining elements, including introduction of the proposed ordinance. Staff recommends Council waive the full second reading and adopt by title an ordinance amending Chapter 12.16 of the Hermosa Beach Municipal Code establishing an outdoor dining program and making procedural changes to the issuance and renewal of encroachments in the City.

Background:

The City has long supported and encouraged outdoor dining on private and public property to supplement indoor operations. With the onset of the COVID-19 pandemic and related heath orders, businesses were limited from operating indoors. Recognizing this hardship, City Council approved a program to allow expanded outdoor dining and other commercial activity. The City also suspended zoning and parking requirements to allow outdoor dining on private property and established a temporary encroachment permit program to allow encroachments into sidewalks, public streets, and Pier Plaza. Both the private property programs and encroachment program included a basic set of guidelines pertaining to hours of operation, permitted uses, maintenance, etc., collectively referred to hereafter as the Outdoor Permit Program.

The City issued over 60 permits during the term of the Outdoor Permit Program in a variety of commercial locations citywide including extended encroachments on Pier Plaza and encroachments into other public right-of-way areas. The program included encroachment into on-street parking spaces, which had previously not been allowed in Hermosa Beach. Initially, as a temporary measure, City Council allowed the uses without requiring any encroachment area rents or reimbursement of lost parking meter revenue. In June 2021, Council approved extension of the pilot program through December 31, 2021 and authorized implementation of a reapplication process for outdoor encroachment areas that included renewal of permissions from neighboring businesses and requirement of deposits to pay for removal of the decks should the City need to do so.

At its December 14, 2021 meeting, Council approved an extension of the programs through May 31, 2022. At its January 25, 2022 meeting, Council discussed implementing new fees for the temporary outdoor dining encroachments and approved a fee of $1.50 per square foot per month to begin March 1, 2022.

Program revenues for the temporary encroachment areas were estimated to be approximately $400,000 annually, based on the number of encroachments in place at the time. At its February 8, 2022 meeting, Council approved reinstatement of the encroachment fees for preexisting encroachment areas, which generate approximately $280,000 annually. Council also approved program refinements related to the use of temporary canopies, branded furniture, and enhanced maintenance.

City Council subsequently extended the program in both May and November of 2022 with a final extension to May 1, 2023 and direction to staff to bring the permanent program for consideration. At the April 25, 2023 meeting, staff proposed a number of key program elements and Council provided feedback and direction on revisions to the elements. At its June 13, 2023 meeting, Council approved the revised program elements, including an ordinance amending Chapter 12.16 (Encroachments) of the Hermosa Beach Municipal Code, a resolution revising existing operational and design guidelines for Pier Plaza and other off-street encroachments, a resolution for new encroachment fees, and accompanying CEQA determinations. Staff will return to Council with additional program elements related to on-street dining at a later date.

Past Council Actions

Meeting Date	Description
June 9, 2020	Approved Ordinance 20-1410U allowing temporary permit program for outdoor dining in response to pandemic.
July 14, 2020	Directed staff to proceed with development of lane closure plans.
June 22, 2021	Approved extension of the outdoor permit program through December 31, 2021.
July 13, 2021	Approved Resolution authorizing extension of lane reconfigurations.
October 26, 2021	Approved development and implementation of permanent versions of these programs.
December 14, 2021	Approved development of permanent programs, and extension of temporary programs through May 2022
January 25, 2022	Discussion and approval of new fees for temporary encroachments
February 8, 2022	Approved reinstatement of existing fees for permanent encroachment areas
May 24, 2022	Approved extension of programs through January 2023
June 14, 2022	Approved additional refinements to the outdoor dining programs
November 3, 2022	Approved extension of temporary programs through May 1, 2023
January 24, 2023	Consideration market rate appraisal, temporary rooftop dining, and changes to Pier Plaza temporary encroachments
March 28, 2023	Considered a draft ordinance related to permanent outdoor dining and retail
April 25, 2023	Considered program elements, provided feedback for revisions, and approved a resolution establishing lane reconfigurations, bike lanes and street closures.
June 13, 2023	Approved Ordinance and two Resolutions related to establishing a long-term outdoor dining program.

Discussion:

As directed by Council, staff developed the elements necessary to establish a permanent version of the Outdoor Dining Program and Downtown Lane Reconfiguration Program. The elements include:

1. An ordinance amending Hermosa Beach Municipal Code Chapter 12.16 to establish basic guidelines for a permanent outdoor dining and retail program.

2. A resolution establishing a new fee schedule for encroachments citywide.

3. A resolution permanently establishing the downtown lane reconfigurations and bike lanes.

4. A resolution amending operational and design guidelines for Pier Plaza.

5. A CEQA determination for the program elements.

6. A resolution adopting guidelines for operational and design standards for on-street dining decks.

The elements were developed and reviewed by a diverse team of City staff, representing all City departments. The City secured specialists to help with traffic counts and analysis, CEQA findings, traffic safety and on-street dining deck specifications, and market appraisal of encroachment areas. Staff gathered feedback from businesses, community members, other agencies, and an array of stakeholders since 2020. The Economic Development Committee meetings, along with numerous City Council meetings, provided excellent feedback both from Councilmembers and the many people that have shared their views at the meetings. The Chamber of Commerce has been an essential partner in stakeholder outreach, both sharing vital information with its members and gathering data through multiple surveys over the span of the temporary outdoor dining program.

At its June 13, 2023 meeting, Council approved the draft ordinance with a few minor revisions. Council approved a maximum area for encroachments located on Pier Plaza and off-street locations of 500 additional square feet with a maximum of 1,000 square feet per business. Council also struck language related to the businesses’ need to open and close umbrellas within the encroachment areas. Finally, Council approved a resolution related to design and operational guidelines for Pier Plaza and other off-street encroachment areas. Council revised these guidelines at the meeting by directing the removal of language related to prohibitions on queueing.

Council also approved the fee schedule below, previously suggested at the April 25^th meeting, to go into effect on July 1, 2023. It includes a three-year “ramp up” of fees based on encroachment categories reflective of operating hours.

Encroachment Area Category	Proposed Fee per square foot, per month for 2023-24	Proposed Fee per square foot, per month for 2024-25	Proposed Fee per square foot, per month for 2025-26
Pier Plaza, closes after midnight	$4.00	$5.00	$6.00
Pier Plaza, closes before midnight	$2.00	$3.00	$4.00
Pier Plaza, closes encroachment before 11pm; off-Pier Plaza; on-street; sidewalk; retail	$1.00	$2.00	$2.50

Next Steps

Staff will return to Council at an upcoming meeting to seek approval of the final design and operational guidelines for the on-street dining decks. As directed by Council, all pre-existing and temporary encroachments will be allowed to remain through the summer before reapplying for permits October 1. The new encroachment fee schedule suggested went into effect on July 1.

City staff also met with Coastal Commission staff and established that a five-year pilot program would be an effective approach to lead to a permanent program. The pilot program would include ongoing monitoring and assessment to document the project’s effect on parking and coastal access. It may also include testing a variety of programs and measures to ensure adequate coastal access is maintained during the pilot. Staff is currently working to develop acceptable measures to be incorporated into the program that would satisfy the criteria for the Coastal Development Permit.

General Plan Consistency:

The proposed program options match the model of “living streets”, also known as “complete streets”, which supports a key guiding principle of the General Plan Vision, of fostering a vibrant local economy. A living street combines safety and livability while supporting ground floor and outdoor economic activities. This centers on designing streets that can be safely shared by both vehicular and non-vehicular traffic. A living street should also contribute to an engaging public realm and a vibrant local economy.

Relevant Goals and Policies are listed below:

Governance Element

Goal 6. A broad-based and long-term economic development strategy for Hermosa Beach that supports existing businesses while attracting new business and tourism.

Policies:

• 6.4 Business support. Support the Chamber of Commerce, retailers, tourist service businesses, artists, and other agencies to develop an aggressive marketing strategy with implementation procedures.

• 6.6 Pop-up shops. Develop plans and programs for underutilized spaces, such as vacant buildings, utility corridors, parkways, etc., for temporary retail, restaurant, and community promoting uses.

Mobility Element

Goal 1. Complete Streets (Living Streets) that serve the diverse functions of mobility, commerce, recreation, and community engagement for all users whether they travel by walking, bicycling, transit, or driving.

Policy:

• 1.1 Consider all modes. Require the planning, design, and construction of all new and existing transportation projects to consider the needs of all modes of travel to create safe, livable and inviting environments for all users of the system.

Goal 7. A transportation system that results in zero transportation-related fatalities and which minimizes injuries.

Policy:

• 7.1 Safe public rights-of-way. Encourage that all public rights-of-way are for all users at all times of day where users of all ages and ability feel comfortable participating in both motorized and non-motorized travel.

Fiscal Impact:

The Capital Improvement Fund includes $60,000 appropriated for the CEQA specialist to perform the CEQA analysis and an additional $60,000 was appropriated to fund additional traffic and parking analysis to support the analysis work. Funds for ongoing annual traffic and parking analysis will be appropriated in the FY 2023-24 Budget.

The proposed encroachment fees are estimated to generate approximately $525,860 in revenue in the first year, which is a decrease of approximately $29,658 from the revenues generated by the current rates and current businesses. Staff is unable to predict final business participation levels and thus revenues could fluctuate.

Staff will return to Council at a future meeting to establish application review fees and will provide revenue estimates at that time.