City Council Eases Land Value Recapture Fees, Aims to Spur Downtown Development
Council supports Planning Commission decision to backtrack on 'failed experiment'
Homeless update, Outdoor seating fees and controversial developer fee program all on the agenda, together with beach vendor proposals
The Hermosa Beach City Council unusually meets just one week after its last session, with several items continued from the January 27 meeting including an update on the city's now-defunct homelessness outreach program, a proposal to allow food vendors at beach events, and potential changes to affordable housing fees.
Council will receive a final report on the HB Cares pilot program, a mobile crisis response initiative that operated from May 2024 through September 2025 before federal grant funding expired.
The program, run by Los Angeles Center for Alcohol and Drug Abuse (L.A. CADA), deployed civilian teams to respond to calls involving homeless individuals and mental health crises as an alternative to police response. Over approximately 251 days of service, the program handled 336 total calls and provided 234 services to 34 individuals experiencing homelessness.
The outcomes were modest: two individuals were housed, two were reunited with family, two entered shelter, one went to a nursing home, and one entered drug rehabilitation. However, 22 of the 34 individuals served remained "service resistant," according to staff.
The program faced significant challenges including staff turnover at L.A. CADA, limited staffing during peak periods, difficulty locating and engaging individuals, and barriers to housing resources. Staff recommends future programming include continuous mental health and housing assistance and exploration of regional collaborations.
Following a recommendation from the Parks, Recreation, and Community Resources Advisory Commission, council will consider whether to allow food, beverage, and merchandise vendors—beyond just event producers—to sell at approved beach events like volleyball tournaments.
Current city code permits only the event producer to sell on the beach. The proposed change would allow additional vendors selling prepared food and non-alcoholic beverages, with a $115 per-vendor daily fee. Hermosa Beach businesses with valid city licenses would receive a 25% discount, paying $86.25 per day.
The commission did not recommend allowing alcohol sales or consumption on the beach, citing public safety concerns, potential liability, and the operational requirements that would include fenced areas and additional police staffing.
Staff noted that event producers, particularly volleyball tournament organizers, have requested these changes to improve the financial viability of their events.
In a move aimed at encouraging housing development on smaller parcels, council will consider reducing or eliminating Land Value Recapture fees for properties that can accommodate only a few residential units.
The Planning Commission recommended exempting lots with minimum density of one to two units from any fee, and temporarily reducing fees for three- and four-unit lots from $76 to $40 per square foot for 24 months.
The LVR program, adopted as part of the city's Housing Element, charges developers a fee when building market-rate housing on parcels that were rezoned to allow residential use. The fee can be avoided by including affordable units in the project. To date, no applications have been submitted on Housing Element overlay sites that include affordable units or trigger LVR fees.
Small lots account for nearly 25% of the 558 residential units the city must plan for under state housing requirements.
Council will consider reducing commercial encroachment fees for businesses that don't offer table service or alcohol in their outdoor dining areas. The change might possibly apply to just two establishments—Mickey's Deli and the Green Store—reducing their rate to $2 per square foot from the current $2.50.
The city collects approximately $200,000 quarterly in commercial encroachment fees. The proposed reduction would decrease revenue by about $4,000 annually. Council may also discuss converting these spaces to other public uses such as benches or bike parking.
In other business, council will:
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