Parking: A proposal to demolish the structure was paused by a judge. Matthew Hall

The decision will again delay demolition of a downtown parking structure that the city wants replaced with affordable housing

On Tuesday night, Santa Monica City Council voted after a long hearing to enter into an agreement with developer EAH, Inc., to replace Parking Structure 3 (PS3), located on 4th Street between Arizona Avenue and Santa Monica Boulevard, with an affordable housing complex.

Less than 48 hours later, a ruling out of LA County Superior Court put the project on ice, with Judge Mitchell L. Beckloff issuing a preliminary injunction delaying demolition of the three-story structure until a court hearing can be scheduled for later in 2022.

The project

With a goal of providing supportive housing to some of the 230-or-so unhoused individuals on Santa Monica’s Service Registry, the City has spent the last few years working to construct more affordable housing within city limits.

The Service Registry includes homeless people who fall into four categories: formerly housed Santa Monicans who became homeless, unhoused people who work in Santa Monica, homeless individuals who are known to have lived on Santa Monica’s streets for at least five years, and homeless individuals who rely most on 9-1-1 and other emergency services on a regular basis.

“The most effective way to stretch our limited affordable housing dollars is to create affordable housing on city owned land. The conclusion recognizes that buying private land is by far the largest city expense in the creation of affordable housing,” Community Services Director Andy Agle explained during the Tuesday, Jan. 11, City Council Meeting. He went on to say PS3 was selected for the housing project in 2019 because it was owned by the city and already slated for demolition.

On Tuesday, Council heard three different proposals for the project, which would provide housing for people on the Santa Monica Service Registry as well as other affordable units not set aside for currently unhoused people.

For the units set aside for formerly homeless individuals, an array of services included “personal case management, benefits counseling, mental health counseling, health care, substance use services, money management and legal assistance provided directly and through partner agencies,” the proposal from frontrunner EAH, Inc., stated.

In a unanimous, 7-0, vote, council members selected EAH as the developer for the project. But when it came to the homeless services portion, there was less than unanimous enthusiasm for proposed partner The People Concern (TPC). A handful of residents who called in to the virtual meeting during the three-hour hearing cited concerns over TPC’s track record in the community.

Council Member Oscar de la Torre questioned whether EAH’s contract locked in TPC as a partner.

“I want a robust assessment,” de la Torre said. “And to marry yourself right now, you know, to one social service provider? I think it’s a disservice to that assessment. So, I want to have that robust assessment.”

Council Member Gleam Davis said she was open to further assessing the details of services but would not agree to a decision blocking TPC from the project.

“I just don’t want staff’s takeaway to be from this that they need to necessarily go look for another social services provider; they can evaluate the social services that need to be provided and then evaluate who the best entity is to provide those,” Davis replied. “I’m fine with that. But I just want to make sure that this isn’t misinterpreted as giving direction to sever the people’s concern and go look for somebody else.”

In the end, council agreed to make evaluating the social service provider one of the key factors as the project moved forward into the next project phase, which will include community input on design and other priorities.

When it came to design, EAH Development Director Steven Spielberg described the proposal, which includes either 120 or 150 housing units with ground floor retail and underground parking.

“For the ground floor, we’re proposing a full service grocery store with ample subterranean parking and an additional space for a local nonprofit,” Spielberg described. “While we’re flexible and open to what Council and the community feels is the best fit, we believe that grocery is the perfect complement for the families and formerly homeless individuals that will be living upstairs. A market provides healthy food options, job opportunities and a basic need to others in the downtown area.”

Spielberg also said grocery stores had proven to be resilient businesses during the pandemic, mentioning Sprouts and Grocery Outlet as two potential tenants.

“While parking is not required, we felt it was important to include ample parking for both residents and retail,” Spielberg continued, adding, “Also, while we believe that providing space behind the grocery store to a local nonprofit is a great idea, we’ve heard that a police substation may be desired. We’ve already had talks with the Santa Monica Police Department about creating something that would work for them as well as the future residents in the project.”

The lawsuit

The Council hearing took place at the same time LA Superior Court was considering a request from local property owners that could throw the whole project into jeopardy.

The Santa Monica Bayside Owners Association (SMBOA) filed a lawsuit in mid-2021 requesting courts block the demolition of PS3. SMBOA argued the city was relying on an inadequate environmental impact report and was not in compliance with the California Environmental Quality Act, commonly known by its acronym, CEQA.

On Thursday morning, Judge Mitchell L. Beckloff announced his decision to delay the demolition as the court case progressed.

In court documents, Beckloff wrote the decision to hold off on demolition was based on two factors: the likelihood of SMBOA’s arguments prevailing in court and the potential harm suffered by either party in the interim. In other words, Beckloff had to weigh which would be more harmful: demolishing PS3 before the case was finished working its way through court, or holding off on demolition until SMBOA’s lawsuit was decided?

The documents also laid out both sides’ arguments.

SMBOA’s was two-fold — first, that the demolition would render the lawsuit moot and second, that many residents and stakeholders rely on PS3 as parking for their business and employees.

“Admittedly, it would be difficult to ascertain with specificity the damage to local businesses — if any — from the loss of parking,” Beckloff wrote. “However, Petitioner’s failure to submit any evidence of any real, immediate, concrete harm from the demolition is problematic.”

Santa Monica’s legal team, Beckloff wrote, argued that “the City’s prior actions have resulted in a net increase in parking supply given the improvements to Parking Structure 6, which created new, additional parking spaces, even with the demolition of PS3.”

The City’s legal representatives argued the delay in demolition would create harm for the project moving forward, but Beckloff determined if the parking structure were to be demolished before SMBOA’s complaints were heard, the group would be “left with no remedy … as the court cannot require the City to reconstruct a demolished parking lot.” In other words, moving forward with demolition would be a greater harm to SMBOA than delaying would be to the City.

However, Beckloff’s decision added, “Nothing in this order is intended to require the City to continue to operate PS3 during the pendency of these hearings.”

City representatives were not able to respond to questions by Daily Press deadline, but provided a statement acknowledging the ruling. According to the City, a final decision is not expected until April.

The opponents will appear in court next on Jan. 28.

“The court intends to set trial on the petition on an expedited basis on Jan. 28, 2022, at the trial setting conference,” the decision stated.

emily@smdp.com