Article 5A

TWO-UNIT DEVELOPMENT IN SINGLE-FAMILY RESIDENTIAL ZONING

DISTRICTS

Sections:

§ 38-26.1. Two-Unit Development.

A. Purpose. This section sets forth special regulations applicable to the construction of two dwelling units in the single-family zoning districts pursuant to Government Code Section 65852.21. In the event of a conflict between the provisions of this section and the generally applicable regulations in this Chapter, the more permissive provisions shall prevail.

B. Application Process. The City shall ministerially review and approve or deny an application for a two-unit development in single-family zoning districts as provided by Government Code Section 65852.21 and this Article. Applications for a two-unit development shall be submitted to, and made on forms kept and updated by, the Community Development Director, who shall be responsible for determining within 60 days of receipt of a completed application whether a two-unit development application meets the requirements for ministerial approval.

• C. Denial. A two-unit development shall be denied for any parcel:

1. Described in Government Code Sections 65913.4(a)(6)(B) through (a)(6)(K), incorporated herein by reference, as that section read on September 16, 2021. Such parcels include, for example, parcels located in earthquake fault zones, hazardous waste sites, wetlands, very high fire severity zones (unless the site has adopted certain fire hazard mitigation measures), and in special flood hazard areas or regulatory floodways, protected habitats, etc.;

2. That requires demolition or alteration of any of the following types of housing:

The Monterey City Code is current through Ordinance 3716, passed February 3, 2026.

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• a. Housing that is subject to a recorded covenant, ordinance, or law that restricts rents to levels affordable to persons and families of moderate, low or very low income.

• b. Housing that is subject to any City ordinance imposing rent control.

• c. Housing that has been occupied by a tenant in the last three years.

• d. A parcel on which an owner exercised the owner’s rights under Government Code Section 7060 et seq. to withdraw a unit from rent or lease within the past 15 years;

3. Located within a historic district or property included on the State Historic Resources Inventory, as defined in Public Resources Code Section 5020.1, or within a site that is designated as a City landmark or historic property or historic district pursuant to a City ordinance;

4. Created by an urban lot split under Article 7 of Chapter 33 of this code that would result in more than two units of any kind per parcel, including primary dwelling units, accessory dwelling units, junior accessory dwelling units, on parcels unless there is compliance with the affordability criteria set forth in subsection (G) of this section; or

   5. If the building official makes a written finding, based on a preponderance of the evidence, that the proposed housing development project would have a specific, adverse impact upon public health and safety, for which there is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact.

• D. Approval. A two-unit development shall be ministerially approved if the following criteria are met:

  1. The parcel is located in a single-family residential zoning district.

  2. The dwelling units in the two-unit development may be new construction and/or converted from an existing, permitted structure that meets the requirements of this Article.

3. The proposed two-unit development complies with all objective zoning standards, objective subdivision standards, and objective design review standards applicable to the parcel as provided in the zoning district in which the parcel is located; provided, however, that:

a. The application of such standards shall be modified as required to physically allow the construction of two units up to 800 square feet each.

• b. Notwithstanding subsection (D)(3)(a) of this section, required rear and side yard setbacks shall equal at least four feet, except that no setback shall be required for an existing structure or a structure constructed in the same location and to the same dimensions as an existing structure.

4. As defined in Section 37-2, protected tree(s) whose dripline is within the proposed footprint of any unit constructed in a development at the time of application shall be replaced on site. The replacement ratio shall be two replacement trees per tree impacted. Replacement tree(s) shall be provided in addition to all other required landscaping pursuant to objective standards and shall be installed prior to final occupancy of the proposed development. The replacement tree(s) shall be minimum 15-gallon container size at time of

The Monterey City Code is current through Ordinance 3716, passed February 3, 2026.

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planting and be of the same size or a greater size at maturity as the tree(s) being removed. The replacement tree(s) shall be any one or more of the species listed on the City of Monterey Urban Forestry’s online list of trees suitable for Monterey, unless the tree(s) being removed are Monterey Pine, Monterey Cypress, or Coast Live Oak, then the replacement trees shall be of those same species.

5. Proposed adjacent or connected dwelling units shall be permitted if they meet building code safety standards and are designed sufficiently to allow separate conveyance. The proposed dwelling units shall provide a new or separate utility connection, including a separate sewer lateral, between the proposed dwelling units and the utility. A connection fee or capacity charge may be charged that is proportionate to the size in square feet of the proposed dwelling units or their drainage fixture unit (DFU) values. Separate electric and water submeters shall be required for the proposed dwelling units. Separate water meters shall be required for the proposed dwelling units when the City’s water purveyor is allowed to establish new water meters.

6. Parking. One off-street parking space shall be required per unit constructed via the procedures set forth in this Article, except that the City shall not require any parking where:

• a. The parcel is located within one-half mile walking distance of either a stop located in a high-quality transit corridor, as defined in Public Resources Code Section 21155(b), or a major transit stop, as defined in Public Resources Code Section 21064.3; or

  • b. There is a designated parking area for one or more car share vehicles within one block of the parcel.

7. Dwelling units created by a two-unit development may be used for residential uses only and may not be used for rentals of less than 30 days.

8. If any existing dwelling unit is proposed to be demolished, the owner will comply with the replacement housing provisions of Government Code Section 66300.5 or successor provision.

E. Declaration of Prior Tenancies. If any existing housing is proposed to be altered or demolished, the owner of the property proposed for a two-unit development shall sign an affidavit, in the form approved by the City Attorney, stating that none of the conditions listed in subsections (C)(2)(c) and (C)(2)(d) of this section exist and shall provide a comprehensive history of the occupancy of the units to be altered or demolished for the past three years (five years if an existing unit is to be demolished).

F. Recorded Covenant. The City Manager or their designee is authorized to execute the restrictive covenant required under this section on behalf of the City and to deliver any approvals or consents required by the covenant. Prior to the issuance of a building permit, the applicant shall record a restrictive covenant in the form prescribed by the City Attorney, which shall run with the land and provide for a prohibition on nonresidential use of any units developed or constructed through the two-unit development procedure, including a prohibition against renting or leasing the units for fewer than 30 consecutive calendar days.

• G. Affordable Unit Incentives.

The Monterey City Code is current through Ordinance 3716, passed February 3, 2026.

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1. If at least one dwelling unit in the two-unit development is made available at affordable rent or affordable housing cost to a very low income household (the “affordable unit”), as defined in Health and Safety Code Section 50105, the two-unit development will qualify for the following incentives:

   • a. If the two-unit development is developed on a parcel created through an urban lot split, the total number of dwelling units allowed across both parcels will be increased from four to six dwelling units, with no more than four dwelling units allowed on a single parcel. All three dwelling unit types (i.e., primary dwelling units, accessory dwelling units, and junior accessory dwelling units) count toward this six-dwelling-unit limit.

oped on a parcel created through an urban lot split, the total number of dwelling units allowed across both parcels will be increased from four to six dwelling units, with no more than four dwelling units allowed on a single parcel. All three dwelling unit types (i.e., primary dwelling units, accessory dwelling units, and junior accessory dwelling units) count toward this six-dwelling-unit limit.

• b. If the requirements of the underlying residential zoning district, any applicable overlay district, and all other applicable provisions of this Chapter would restrict the size of the dwelling units in a two-unit development to 800 square feet, the size of one of the primary dwelling units in the two-unit development shall be allowed to go up to 1,000 square feet if two or more bedrooms are provided.

2. Prior to the issuance of a building permit for any new dwelling unit incorporating either or both of the incentives in subsection (G)(1) of this section, the property owner must record a regulatory agreement against the parcel that is or will concurrently be developed with the affordable unit. The regulatory agreement shall be in the form provided by the City Attorney’s Office restricting the sale or rental of the affordable unit such that the affordable unit will be sold or rented to a very low income household, as defined in Health and Safety Code Section 50105, at an affordable housing cost or affordable rent (the “regulatory agreement”). The City Manager or their designee is authorized to execute the regulatory agreement on behalf of the City and to deliver any approvals or consents required by the covenant. (Ord. 3710 § 4, 2025)