On a Los Angeles hillside lot, whether a lower level is a Basement is not settled by what the drawing calls it. It is a perimeter measurement against a surface the code does not let the design move — and the answer neither stays won nor travels. The zoning code can keep that level out of the residential floor-area count, then count it as a Story when the side and rear yards are set; the California Building Code, the state code applying in Los Angeles, measures from a reference surface of its own.
Key numbers
| Figure | What it governs | Section |
|---|---|---|
| 3 feet, over at least 60 percent of the basement wall perimeter | the floor-area exception, hillside lot | LAMC § 12.03 |
| six feet above grade over more than 50 percent of the perimeter, or 12 feet at any point | the First Story | LAMC § 12.03 |
| 1,000 cubic yards plus 10% of the lot size | the cut-and-fill limit | LAMC § 12.21 C.10(f)(1) |
Which surface the height rules read
Section 12.21 C.10 carries the single-family hillside standards for "any Lot zoned R1, RS, RE or RA and designated Hillside Area" — a designation read off the Department of City Planning Hillside Area Map. Its subdivision (d) does one job first: "For the provisions below, whenever Grade is mentioned, it shall mean Hillside Area Grade as defined in Section 12.03 of this Code."
Section 12.03 sets that datum at the perimeter, at "the finished or natural surface of the ground, whichever is lower", then closes: "Retaining walls shall not raise the effective Elevation of Grade for purposes of measuring Height of a Building or Structure". Fill cannot raise it, since the lower of the two governs, and a wall is barred outright. The move left is to cut.
How high, and over how much of the perimeter
Section 12.03 writes Basement as "Any level below the First Story of a Building" and excludes a Basement from Story. Its Residential Floor Area exception keeps a level out of that count, and splits by geography.
In the Hillside Area the exception holds where the surface above the Basement "does not exceed 3 feet in height at any point above the finished or natural Grade, whichever is lower, for at least 60 percent of the perimeter length of the exterior Basement walls". For a lot "not located in the Hillside Area or Coastal Zone" the figure is 2 feet at any point, with no perimeter fraction. A third sits in Section 12.21.1 A.1's Height District No. 1-SS sentence: "two feet in height at any point".
Whether the level holds habitable rooms
Section 12.21.1 A.8 is the citywide default, in one sentence: "In determining the number of stories, any basement containing habitable rooms shall be considered a story."
The same test runs again for a different purpose. Inside Section 12.21 C.10, the paragraph headed "Side and Rear Yards for Basements" reads:
In determining the required Side and Rear Yards of a Building, any Basement containing Habitable Rooms shall be considered a Story.
One level, two provisions, one subdivision apart. That is a reclassification: nothing in the sections read here converts a Story into a yard dimension.
Where the Building Code measures from
Section 202 writes BASEMENT derivatively, as "A story that is not a story above grade plane", so everything moves to grade plane: "A reference plane representing the average of finished ground level adjoining the building at exterior walls." Where the ground falls away, "the reference plane shall be established by the lowest points".
A story above grade plane is one whose floor next above is "More than 6 feet (1829 mm) above grade plane" or "More than 12 feet (3658 mm) above the finished ground level at any point".
Section 504.4 rations the result: "The maximum number of stories above grade plane of a building shall not exceed the limits specified in Table 504.4", and Section 504.1 sets that number "based on the type of construction, occupancy classification and whether there is an automatic sprinkler system installed throughout the building".
Where the cheaper lane is, and what it costs
The lane is the lower level that wins Section 12.03's exception above; its price is printed in the same subdivision, where Section 12.21 C.10(f)(1) caps the cumulative quantity of grading, "both Cut and Fill", at "a base maximum of 1,000 cubic yards plus the numeric value equal to 10% of the total Lot size in cubic yards".
It is not the final ceiling: the paragraph adds that "the cumulative quantity of Grading shall not exceed the maximum" … "Grading quantities outlined by Zone in Table 12.21 C.10-6 below", a table not read here, and Section 12.03 counts "recompaction of soil, rock or other earth materials" as Grading. Section 12.21 C.10(f) prints the order: "No Grading permits shall be issued until a Building permit is approved." The exception neither stays bought for the yards nor travels to Section 504.4.
What this looks like on the drawing
On a section drawing this is a line, not a label. The grade line runs at the lower of finished or natural ground at each point of the perimeter, and the exception asks how much of that perimeter keeps the floor above within three feet of it. The story count on the sheet follows from the First Story test. Another object is drawn against that line: a side wall "exceeding 14 feet in height and a continuous length greater than 45 feet" buys an offset five feet deep and 10 feet long.
Currency
The zoning sections are LAMC Chapter 1, 2026-08 edition, updated 2026-10-05. Sections 202 and 504.4 are the 2025 California Building Code (Title 24, Part 2), 2025 edition, updated 2026-10-24, which prints no ordinance history.
- Section 12.03's terms used here, and Section 12.21 C.10's subdivisions: Ord. No. 184,802, Eff. 3/17/17. Section 12.21.1 A.8: Ord. No. 131,309, Eff. 4/24/66.
- Section 12.21 C.10 lead-in: Ord. No. 187,712, Eff. 1/23/23, Oper. 1/22/24, and Ord. No. 187,930, Eff. 7/7/23.
Nothing here has been amended within 24 months of September 2026. No amendment date is recorded beside subparagraph (4) of subdivision (d), beside Section 12.21.1 A.1's 1-SS sentence, or for Table 12.21 C.10-6, which was not read.
Frequently asked questions
Doesn't a hillside basement simply stop counting as a story?
One height district carries it, and says so in its heading: the paragraph is headed "Lots in a Single-Story Height District", for lots shown as 1SS on a Zoning Map, and says a Basement exempt from the Residential Floor Area calculation "shall not be considered a Story". Outside it, Section 12.21.1 A.8 governs.
Can fill or a retaining wall move the grade?
Not as a matter of text. Section 12.03 takes "the finished or natural surface of the ground, whichever is lower", so fill does not raise it, and closes: "Retaining walls shall not raise the effective Elevation of Grade". A wall may hold a cut, but it does not produce the classification.
How much does that paragraph add to a side yard?
Not something the sections read here answer. The paragraph states the reclassification and stops; nothing in these sections turns a Story into a yard dimension.
Sources
- Los Angeles Municipal Code Section 12.03 — Definitions: https://gocodebook.com/library/us/ca/los-angeles-planning/chapter-i-general-provisions-and-zoning/article-2-specific-planning-zoning-comprehensive-zoning-plan/sec.-12.03.-definitions#12.03
- Los Angeles Municipal Code Section 12.21 C.10 — Single-Family Zone Hillside Area Development Standards: https://gocodebook.com/library/us/ca/los-angeles-planning/chapter-i-general-provisions-and-zoning/article-2-specific-planning-zoning-comprehensive-zoning-plan/sec.-12.21.-general-provisions#12.21
- Los Angeles Municipal Code Section 12.21.1 — Height of Building or Structures: https://gocodebook.com/library/us/ca/los-angeles-planning/chapter-i-general-provisions-and-zoning/article-2-specific-planning-zoning-comprehensive-zoning-plan/sec.-12.21.-general-provisions#12.21.1
- California Building Code Section 202 — Definitions: https://gocodebook.com/library/us/ca/ca-building-code/chapter-2-definitions/section-202-definitions#202
- California Building Code Section 504 — Building Height and Number of Stories: https://gocodebook.com/library/us/ca/ca-building-code/chapter-5-general-building-heights-and-areas/section-504-building-height-and-number-of-stories#504.4
Related reading: When a Finished Attic Counts as Another Story: https://gocodebook.com/blog/attic-conversion-requirements-california
Code text quoted as published in GoCodebook's library on 2026-09-13 and re-checked against the library on 2026-10-25. This article does not replace permit review or professional judgment.