On July 27, 2020, Oakland City Administrator, Edward D. Reiskin executed Emergency Order No. 6 extending planning entitlements that have not expired as of March 9, 2020 (when Oakland’s COVID-19 Local Emergency was first declared), but are set to expire on or before August 1, 2022, by two (2) years. A project sponsor must submit a ministerial application and payment of the Administrative Extension Fee for an entitlement extension. Upon satisfaction of those requirements, the entitlement’s expiration date will automatically be extended by two (2) years. Emergency Order No. 6 does not cover entitlements eligible for extension under the city’s impact fee programs for Jobs/Housing, Affordable Housing, and Transportation and Capital Improvements.
If this sounds familiar to you, it is. In the wake of the nation’s last recession, Oakland enacted an extension of all non-expired entitlements. At that time, Oakland was grappling with a continuing weak housing and credit market.
Even prior to the pandemic, California was in the midst of a housing crisis. For years, demand has outpaced supply at all income levels. The economic fallout from the ongoing COVID-19 pandemic is ripping through the country. The extent of its lasting impacts are yet to be determined. To alleviate pressure in the housing sector exacerbated by the pandemic, State Senator Scott Wiener has introduced Senate Bill 281 (“SB 281”). SB 281 would automatically extend the period for expiration of a housing entitlement issued before and in effect on March 4, 2020, and expiring before December 31, 2021, by eighteen (18) months. A housing entitlement is defined as, among other things, a “legislative, adjudicative, administrative, or any other kind of approval, permit, or other entitlement necessary for, or pertaining to, a housing development project issued by a state agency” and “[a]n approval, permit, or other entitlement by a local agency for a housing development project.”
In a nod to the ever-present threat of litigation and the weaponization of CEQA often employed to stymie housing projects, the bill’s authors include a tolling provision. If passed, the 18-month entitlement extension would be tolled during any time that the housing entitlement is the subject of legal challenge.
The authors of SB 281 seek a statewide entitlement extension to avoid the significant cost and allocation of local government staff resources associated with addressing individual permit extensions on a case-by-case basis. This makes sense. Under Oakland’s entitlement extension, a project sponsor must submit an application that, while ministerial, still requires administrative resources to process. Having an automatic entitlement extension would reduce cities’ administrative burdens at a time when their limited funds are drying up and tax bases are shrinking.
We will continue to monitor SB 281, and will update readers accordingly.
Authored by Reuben, Junius & Rose, LLP Attorney Justin A. Zucker.
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.