Monterey, CA Zoning Overlays & Bonuses: Density Bonus Law (2026)

Section 38-112.5 is Monterey's local implementation of the state's mandatory Density Bonus Law, so any qualifying housing development is entitled to the density bonus, incentives, parking reductions and development-standard waivers that Government Code Section 65915 provides once the applicant commits to building the required share of very low-, low-, or moderate-income units, senior housing, student housing, a child care facility, or a land donation. Applications go in with the first discretionary or ministerial permit for the project and must include a unit-count summary, the specific Government Code subparagraph the project qualifies under, and a marketing and monitoring plan for projects of 20 units or more.

Beyond the state-mandated bonus, subsection (J) adds bonuses that exist only under Monterey's own ordinance and stack independently on top of State Density Bonus Law. A multifamily project that consolidates two or more legal parcels into a single lot of at least half an acre can earn a 10 percent density bonus. A project where 70 percent of the units are two- and three-bedroom can earn another 10 percent, and in the Alvarado District of the Downtown Specific Plan or the Pacific, Munras, and Cass Multifamily Overlay, that project can also get one additional story of height. A project putting 40 percent of units at moderate income can earn a further 10 percent, and a 100 percent affordable multifamily project can earn a full 50 percent local bonus.

Any density bonus in the coastal zone must still satisfy the certified Local Coastal Program, since state law does not override the Coastal Act, and the City requires a recorded affordable housing benefit agreement, good for at least 55 years on rental units, before it will approve the project.