Dana Point's Base-Density Math Left Out 92 Homes, HCD Found

You're penciling out a multifamily project, and everything hangs on one number: the base density — the units a site is allowed before any density bonus is stacked on top. Get the base right and the bonus, the concessions, and the whole pro forma follow. Get it wrong and the project can shrink until it no longer works. So you ask the city — and the city hands you one answer from the zoning code and a different, higher answer from the general plan.

Here's the thing: under State Density Bonus Law, you don't have to pick. The law takes the greater of the two. That's HCD's position in a Notice of Violation it sent Dana Point over exactly this fight.

The number that kept changing

The site is The Villas at Monarch Beach, at 23731 and 23781 Mariner Drive — a 12.9-acre parcel carrying a general plan designation of "Residential 14-22" and RMF 22 zoning. HCD's letter lays out a timeline any developer will recognize:

• 2017 to roughly 2022: the City confirmed in writing, repeatedly, that the site's base density was 325 dwelling units.
• June 2023: the City Attorney wrote that the number was actually lower — without saying what it was.
• September 2023: a second City Attorney letter said staff had "erroneously communicated the base density of 325 units" and that the real figure was 261 dwelling units.

The developer sued (ST Apartments LLC v. City of Dana Point). Per HCD, the base-density dispute is the heart of the case.

What the law actually counts

HCD's read is straightforward. Base density, the letter quotes from the statute, means:

"the greatest number of units allowed under the zoning ordinance, specific plan, or land use element of the general plan…"

That's Gov. Code § 65915(o)(6). And the base has to be figured on gross acreage — the whole fee-simple parcel — under § 65915(f).

Now run the two documents. The General Plan Land Use Element allows 22 units per net acre and defines a net acre as 35,000 square feet; on this site that works out to 354 dwelling units, or 27.4 units per gross acre. The RMF 22 zoning also says 22 units per net acre — but the zoning defines "net" differently (gross land minus public rights-of-way and dedications), dropping the site to 262 units, or 20.3 units per gross acre.

Same "22 per net acre" on the surface; two different base densities underneath, because the two documents measure a "net acre" differently. HCD's conclusion: the general plan number is higher, so the general plan sets the base. 354, not 262 — a 92-unit gap in the base, before a single bonus unit is added.

Verified against HCD's Notice of Violation to the City of Dana Point (Villas at Monarch Beach, State Density Bonus Law), dated June 12, 2025.

What HCD did about it

When HCD asked for a response, the City wrote back that there was "no active application" and that it would "certainly consider your guidance" if one came in later. HCD didn't accept that:

"This Project is currently unable to proceed because the City has insisted on a base density calculation that contradicts the plain language of the SDBL."

HCD concluded the City "is in violation of state housing law," gave it 30 days — to July 11, 2025 — to respond with a plan to remedy, and reminded Dana Point that HCD can refer noncompliance to the Attorney General under Gov. Code § 65585(j). HCD also flagged a slower-burning problem: the City's Density Bonus Ordinance still dates to 2006, and its housing-element commitment to update it (Program 1.2) is behind schedule — over a stretch in which the City received no density-bonus applications between 2014 and 2021.

Why it matters for your project

If a city hands you a base-density number pulled only from the zoning code, check the general plan's land use element too. HCD's position is that Density Bonus Law entitles you to the greater of the two, figured on gross acreage — and a stricter "net acre" definition buried in an old zoning ordinance doesn't override that. On a site like this one, the difference was 92 homes of base density, before the bonus.

One caution, stated plainly: a Notice of Violation is HCD's interpretive position, not a court ruling — and here the same question is being fought out in court, where the judge, not HCD, has the last word. Your parcel, your general plan text, and your zoning all matter. Read your own numbers against § 65915, and verify with your jurisdiction and your counsel before you rely on any of it. None of this is legal advice.

What CrossBeam does with it

When the letter lands on your desk, CrossBeam turns it around the same day: what each item is actually asking, the code or law behind it, and a written response you can hand to your team or your attorney — the back-and-forth that used to eat weeks, done in a couple of hours.