East Bay state representative Buffy Wicks, along with other co-sponsors including Senator Scott Wiener, proposed a compelling bill that aims to bridge a long-sought gap between pro-housing advocates’ desire for streamlining code-compliant multi-family residential projects with on-site affordability (both mixed-income and 100% affordable), and construction labor unions’ desire to ensure fair wages and future training for its members.
Known as the High Road Jobs Act of 2022, AB 2011 would allow ministerial, by-right approval for certain multi-family affordable housing. A development project in a zoning district where office, retail, and parking are principally permitted would be subject to streamlined, ministerial review if it meets many of the requirements for SB 35 eligibility, as well as additional locational and affordability requirements. AB 2011 projects would not need to obtain discretionary entitlements and would not be subject to CEQA.
To qualify for AB 2011 streamlining, housing development projects must either provide 100% affordability, or provide on-site affordable units, aka BMRs, in a primarily market rate project. As amended in the Senate on August 11, the on-site BMR requirement is somewhat complicated for rental units, but essentially requires between 12-15% BMRs unless a local requirement is higher, in which case the local program applies and additional AMI restrictions could be required. For condos, 30% could be offered at moderate income or 15% at lower income, and the same caveat about higher local requirements applies.
These projects would be subject to objective development standards, and additional qualifying criteria. As of August 11, the criteria for mixed-income projects include, but are not limited to:
- proposing a multi-family housing development project;
- abutting a commercial corridor and having a frontage at least 50 feet in width, on a site 20 acres or less in size;
- not demolishing rent controlled or deed-restricted affordable units, or listed historic resources;
- replacing no more than four existing units;
- located no closer than 500 feet from a freeway;
- providing relocation assistance to certain commercial tenants; and
- vacant properties that are not zoned for multifamily residential use cannot qualify for streamlined ministerial processing.
Once an AB 2011 development application is submitted, several streamlining provisions apply. The local government must determine whether the project complies with objective planning standards within 60-90 days depending on unit count. If a local government determines that a project does not comply with objective planning standards, it must provide a written explanation to the proponent within this timeframe. Further, any design review must be completed within 90-180 days. Projects using the streamlined approval process would also be eligible for density bonuses, incentives, concessions, waivers, reductions in development standards, and potentially reduced parking ratios, under California’s density bonus law.
AB 2011 projects would also be required to pay construction workers at least the prevailing rate of wages and certify their compliance with this provision with the local government. As part of the developer’s obligation to pay prevailing wages, developers building 50 or more units of housing must submit monthly compliance reports to the local government.
Importantly, projects utilizing AB 2011 would not be a project for the purposes of CEQA (i.e. no environmental review) and the approval procedures the municipality would be permitted to use would solely be ministerial in nature.
In May of 2022, AB 2011 passed out of the California State Assembly, and is currently with the Senate, where it was voted out of committee on August 11. The bill has received several key union endorsements, including from the California Conference of Carpenters and SEIU. However, other unions, such as the State Building and Construction Trades Council of California, the San Francisco Building and Construction Trades Council, and the California Labor Federation have opposed the bill claiming it would “eliminate the mandate that a skilled-and-trained workforce be a part of… [project] construction crews.” Unions such as the Building Trades Council oppose the bill because the bill would not require developers to use a “skilled and trained workforce,” which has the effect of eliminating the requirement that a certain percentage of workers on a project are unionized. The bill provides instead that for developments streamlined under AB 2011 that workers be paid a “prevailing wage” with some additional benefits such as healthcare coverage.
We will continue to track this potential game-changer of a bill as it makes its way through Sacramento.
The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm. We specialize in land use, development and entitlement law. We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.