#sb9 Archives

Sacramento Doubles Down on SB 9

June 14, 2023June 14, 2023 | Thomas P. Tunny

In 2022, SB 9 took effect, imposing radical new requirements on local jurisdictions to approve new housing in single-family neighborhoods. Although the results of SB 9 have been mixed (more on that later), Sacramento has seized upon the SB 9 playbook and looked to expand it.

SB 684 seeks to “create new pathways to homeownership for middle-income Californians” by making it faster and easier to build smaller, more naturally-affordable “starter” homes near jobs, schools, transit, and other amenities. The bill streamlines approvals for homes in infill developments of 10 homes or less, in multi-family zones, and on vacant lots in single-family zones. (It’s worth noting that in San Francisco inclusionary requirements kick in at 10 units, so projects seeking 8 or 9 units under this bill may get some pressure to do 10 and fulfill the inclusionary requirement.)

The bill supercharges the lot-split provisions of SB 9. The bill amends the Subdivision Map Act, the state law that regulates the creation and improvement of subdivisions and lot splits, to make it faster and easier to build more housing on a single parcel of land.

Specifically, SB 684:

Requires ministerial approval of a subdivision map that creates up to 10 units on qualifying parcels in multi-family neighborhoods and on vacant lots in single-family neighborhoods.
Shortens the timeframe development may begin by requiring local agencies to approve building permits once a tentative map has been approved under the Subdivision Map Act.
Prohibits the removal of housing that is low income, rent-controlled, or occupied by tenants within the last 7 years.
Ensures streamlined projects meet environmental sustainability standards.

SB 684 was introduced by Anna Caballero, whose district is in the Salinas Valley, and recently was passed by the state Senate. It now moves to the Assembly.

Speaking of SB 9, the 2022 law was adopted with great fanfare. A 2021 analysis by the Terner Center estimated that over 700,000 new homes could be newly feasible to build if SB 9 passed, and taking into account on-the-ground market dynamics. But the reality has been different. Many California cities passed urgency ordinances implementing additional regulations prior to implementing the benefits of SB 9. Some jurisdictions still have yet to adopt the objective design standards needed to approve SB 9 projects.

Local regulations—such as low maximum unit size, height limitations, and other design rules—can render the construction of SB 9 homes infeasible. Not to mention high construction costs and/or lack of expertise with homebuilding. As a result, few jurisdictions in California are seeing much SB 9 activity, and many are seeing none. In San Francisco, only 34 applications have been submitted, and 16 approved (21 total units). Los Angeles had the most overall activity in 2022, with 211 applications for new units under SB 9. We will continue to monitor the progress of both SB 9 and SB 684.

Authored by Reuben, Junius & Rose, LLP Attorney Thomas P. Tunny.

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.

To Fourplex or Not to Fourplex

April 18, 2022April 15, 2022 | Thomas P. Tunny

Senate Bill 9 (SB 9), which took effect January 1, 2022, enables property owners to split their single-family residential lot into two separate lots and build up to two new housing units on each lot. A key component of SB 9 is that it requires ministerial approval of such projects. In San Francisco (the “City”), that means no discretionary review process and other opportunities for project opposition. The City’s policymakers and housing advocates were influential in the adoption of SB 9. And yet, now that it’s here, the City’s lawmakers can’t seem to decide if they like SB 9.

Housing advocates hailed SB 9 for facilitating the construction of new, smaller dwelling units throughout the City. Everyone can agree that the City needs housing. However, the City’s new housing production in recent years has been heavily concentrated in the eastern and southeastern parts of the City, with 90% of all new housing produced in just ten eastside and central neighborhoods. Development in these neighborhoods has at times been subject to significant conflicts and prevented from moving forward. At the same time, roughly 60% of the City’s developable land area is in residential zoning districts, concentrated primarily on the City’s west side, with 38% of the City’s developable land area zoned exclusively for single-family homes. Just 3% of housing built since 2005 was added in areas that allow one to two units (only 6% of affordable housing when ADUs are counted). SB 9 presents a fresh approach.

When Supervisor Rafael Mandelman proposed his “fourplex” legislation last summer, allowing any single-family home to be turned into a fourplex, and corner lots to have six units, it seemed SB 9 would be embraced, and that some of the City’s more vexing housing challenges would be addressed. It wasn’t that easy.

Last Monday (April 11), the Board of Supervisors’ Land Use Committee considered Supervisor Mandelman’s fourplex legislation. Supervisor Mandelman, facing significant political push-back, had amended his legislation to upzone all single-family residential districts (RH-1 and RH-1(D)) in the City to two-family density (RH-2 and RH-2(D)). The elimination of single-family zoning is a means of ensuring the approval of new fourplexes and six-unit projects would not be ministerial, and that discretionary review of these projects would continue. This is because the ministerial provisions of SB 9 apply only to single-family residential districts.

Advocates of preserving the discretionary review process cite the need for the City to maintain design review control over new housing. But discretionary review is not about design review. Discretionary review has become a process that project opponents manipulate to stop new development. It adds significant time, cost, and risk to the production of housing, thereby discouraging new units. If design review is the concern, there are better ways to accomplish that without leaving it to discretionary review.

Other related issues addressed by Supervisor Mandelman’s legislation include residency and tenancy controls, measures to prevent demolition, condominium conversion and subdivision controls, and rent protections.

In the end, at the Land Use Committee on Monday, the Committee approved certain amendments proposed by Supervisor Melgar that sought to encourage larger units, incentivize marginalized homeowners to create more units, and waive the application fees for Historic Resource Assessments, and then voted to continue its consideration of the legislation to the April 25 meeting.

Authored by Reuben, Junius & Rose, LLP Attorney Thomas P. Tunny.

California Enacts Bills Aimed to Increase Housing

October 6, 2021 | Melinda Sarjapur

Last month, Governor Newsom signed three complimentary bills taking aim at the housing crisis in California: SB-8, SB-9, and SB-10. Together, the bills are intended to promote denser housing, streamline housing permitting, and boost housing production in California. The practical effects of the bills, however, are yet to be seen.

SB-9

SB-9 requires local agencies to ministerially approve the following in single-family zoning districts: (a) subdivision of existing lots into two parcels; and (b) development of up to two units per lot. Ministerial approvals require no environmental review, discretionary review, or public hearing process.

While opponents have painted SB-9 as a death knoll for single-family zoning, in reality the legislation comes with slew of caveats and conditions that limit its practical application.

To qualify for ministerial approval of a lot split under SB-9, all of the following must be met:

Site is located in a single-family residential zoning district;
Site is located in an urbanized area or urban cluster, or within a city that has an urbanized area or urban cluster, as designated by the US Census Bureau (which covers most urban and suburban cities in the state);
Subdivision creates no more than two new parcels of approximately equal lot area, provided that one parcel may not be smaller than 40% of the lot area of the original parcel proposed for subdivision;
Both newly created parcels must be no smaller than 1,200 square feet, unless the local jurisdiction adopts an ordinance allowing for smaller lot sizes with ministerial approval;
Site is not located on property that is prime farmland or farmland of statewide importance; wetlands; in a very high fire hazard severity zone; a hazardous waste site; in a delineated earthquake fault zone; in a special flood hazard area; in a regulatory floodway; identified for conservation in an adopted natural community conservation plan; a habitat for a protected species; or subject to a conservation easement;
Subdivision would not require demolition or alteration of housing subject to rent control; designated affordable housing; housing that has been removed from the rental market through Ellis Act eviction in the last 15 years; or housing that has been occupied by a tenant (market rate or affordable) in the past 3 years;
Site is not an historic landmark, and is not located within an historic district;
Site was not created through a prior SB-9 subdivision; and
Neither the owner of the parcel being subdivided or any person acting in concert with the owner has previously used SB-9 to subdivide an adjacent parcel.

To qualify for ministerial approval to develop up to 2 units per lot under SB-9, the locational and tenant-history criteria are similar. In addition, applicants will need to show that the project won’t demolish more than 25% of the existing exterior structural walls, unless either a local agency passes legislation allowing otherwise, or the site has not been occupied by a tenant in the last 3 years.

SB-9 also contains an owner-occupancy condition which limits its utility for development entities. Applicant-owners will be required to sign an affidavit stating their intent to occupy one of the resulting housing units as the owner’s principal residence for at least three years following the lot split. However, community land trusts and qualified nonprofit corporations are exempt, and local agencies cannot impose any other owner-occupancy requirements.

And while SB-9 will allow for ministerial approval of qualifying projects, local agencies can still require all of the following:

Lots resulting from ministerial subdivision be limited to residential use;
No short term rental of units resulting from ministerial approval;
Project compliance with all objective zoning, subdivision, and design review standards applicable to the parcel that do not have the effect of physically precluding construction of two units on either resulting parcel or result in a unit size of less than 800 sf;
That new structures provide setbacks of up to 4 feet form side and rear lot lines;
For residential units connected to an onsite wastewater treatment system, a percolation test completed within the last 5 years, or, if the percolation test has been recertified, within the last 10 years.
Projects provide easements for provision of public services and utilities;
All resulting parcels maintain access to or adjoin the public right of way;
Projects to provide parking of up to 1 space per resulting unit, unless the site is located within ½ mile of a high-quality transit corridor or major transit stop, or there is a car share vehicle located within 1 block of the site.

Finally, on lots that are both created by an SB-9 lot split and developed with two units under SB-9, a local agency is not required to permit ADUs or JADUs.

SB-8

SB-8 primarily extends the Housing Crisis Act of 2019 (SB-330) another five years until 2030 and clarifies some of the text of the previous measure. Among other things, SB-330 expedites the permitting process for housing developments; protects existing housing inventory; allows housing developments to file preliminary applications that provide grandfathering protection against zoning changes enacted during the discretionary review process; and limits the ability of local agencies to downzone areas unless they upzone an equivalent amount elsewhere within their boundaries.

SB-10

SB-10 authorizes local governments, at their election, to adopt an ordinance to zone any parcel for up to 10 residential units in transit-rich areas or urban infill sites. That would apply to most properties located along established bus lines, within half a mile of a major transit stop, or in residential/mixed use areas of most California cities. Ordinances or resolutions adopted by local agencies under SB-10 are exempt from environmental review, would require a 2/3 vote in favor from the local legislative body to adopt, and could not be used to reduce density otherwise permitted on any parcel subject to the ordinance. SB-10 would further prohibit a residential or mixed-use project with 10 or more units that is located on a parcel zoned pursuant to an SB-10 ordinance from being approved ministerially or by right, or from being exempt from environmental review.

Authored by Reuben, Junius & Rose, LLP Attorney Melinda Sarjapur.

Eliminating Single Family Zoning is OK, but Don’t Eliminate Parking

August 31, 2021 | Matthew Visick

SB 9 Makes it Through the Assembly but AB 1401 Dies in the Senate

Two bills that would limit local control over housing issues met very different fates this past Thursday in the California Legislature. Both were vehemently opposed by cities and groups that favor local control over land use decision making. One was opposed by housing equity groups.

Senate Bill 9

Senate Bill 9 (“SB 9”) would, among other things, require a city or county to ministerially approve (1) a two-unit housing project in a single-family zone, (2) the subdivision of a parcel zoned for residential use into two parcels, or (3) both.

SB 9 could unlock substantial housing production in single-family neighborhoods, where opposition to multi-family housing projects is typically greatest. Many of the lots in these districts include only a single-family home and maybe an Accessory Dwelling Unit (which cannot be separately sold). SB 9 would allow each existing single-family lot to be ministerially subdivided into two lots, and require ministerial approval of a duplex on each of the lots.

According to the Terner Center for Housing Innovation at UC Berkeley, SB 9 has the potential to allow for the development of nearly 6 million new housing units statewide.

Assembly Bill 1401

Assembly Bill 1401 (“AB 1401”) would limit minimum off-street parking requirements for projects located near a “major transit stop” (generally a train station or bus station with high frequency headways).

AB 1401 is hardly radical legislation. When first introduced by Assembly Member Friedman in February 2021, the bill prohibited public entities (cities and counties) from imposing or enforcing minimum parking requirements on residential, commercial, or other development that is located within one-half mile walking distance of a “major transit stop” (generally a rail stop or a bus stop with frequent headways). As last amended on July 5, 2021, the bill eased the prohibition for smaller cities. A city with a population of 75,000 or more that is located in a county with a population of less than 600,000 was only prohibited from imposing the parking minimums on projects located within one-quarter mile of a major transit stop, and a city with a population of less than 75,000 was not subject to any prohibition.

Studies show that eliminating minimum parking requirements for projects located near transit routes supports the state’s housing goals by reducing the cost to deliver housing and allowing more dwelling units on a development site. Eliminating parking requirements near transit also advances the state’s environmental goals by reducing emissions from cars.

Wait, the Parking Bill is the One That Died?

Both SB 9 and AB 1401 sailed through their respective policy committees in both the Assembly and the Senate with large vote margins in support. Both were vehemently opposed throughout by local governments and groups that advocate for “local control” over land use decision making. Yet AB 1401 was referred to the “suspense file” in the Appropriations Committee, where ambitious legislation often goes to die, while SB 9 was not.

It is hard to know exactly why bills are referred to the “suspense file.” The “suspense file” is intended to be a place to evaluate whether to advance a bill that could have a significant fiscal impact. But committee analyses of both SB 9 and AB 1401 show that both bills were anticipated to have the same annual impact on the budget (SB 9: $89,000 and AB 1401: $97,000).

A more plausible explanation emerges when one considers the groups opposed to the changes the bills would bring. It is not surprising that numerous suburban cities and local government groups opposed both bills (SB 9 faced even greater opposition from these groups than AB 1401). However, the opposition to AB 1401 was more diverse. Affordable housing advocates argued that eliminating parking minimums for market rate development would reduce incentives for developers to create the affordable dwelling units required to reduce parking requirements using the Density Bonus Law. In addition, environmental groups objected to the reduction of parking near transit as inconsistent with equity goals.

Decline in Value Real Estate Tax Appeals Due September 15

The deadline to appeal the valuation of property for real estate tax purposes is September 15 for both San Francisco and Alameda Counties. Such an appeal would be appropriate due to a decline in property value because of the impact of Covid-19 and the related business shutdowns. If you need more information, please contact Kevin Rose at krose@reubenlaw.com (415.567.9000). Other counties may have different deadlines, so you should check with your local County appeals board to confirm the deadlines.

Authored by Reuben, Junius & Rose, LLP Attorney Matthew Visick.

Housing Production Legislation to Watch

December 16, 2020December 18, 2020 | Justin A. Zucker

The start of another legislative session is upon us. Last week at the outset of the 2021-2022 legislative session, several bills impacting housing production were introduced. Some are similar to bills that weren’t passed last year. Below are four bills to watch as they wind through the Legislature.

SB9 (Atkins, Caballero, Rubio, Wiener)

SB9 is a refresh of SB1120 from last session that would allow duplexes on most lots. SB9 requires cities to ministerially permit, i.e., without CEQA review or other discretionary reviews or hearings, two-unit development projects in single-family zoning districts. It would also allow single-family parcels to be subdivided into two lots if the parcel is located within an urbanized area or urbanized cluster and is: (i) not located within a historic district, (ii) not included in the State Historic Resources Inventory, or (iii) not within a site that is designated or listed as a city or county landmark/historic property/district.

SB1120 cleared the Assembly with only minutes left in the session, leaving too little time for it to return to the Senate for passage, which makes this year’s SB9 a bill to closely watch.

SB10 (Wiener)

Senator Wiener’s SB10 is a refresh of SB902 from last session that would allow—but not require—local governments to upzone qualified parcels for up to ten-unit apartment buildings. The allowance for streamlined upzoning would only apply in urbanized locations close to job-rich areas, which are defined as areas rich with jobs or would enable shorter commute distances, and/or transit rich areas, which are defined as areas within half a mile of a major transit stop. While SB10 creates a shortcut for upzoning, it does not provide for streamlined project approvals, i.e., projects within upzoned areas would remain subject to CEQA and other local approval processes. SB10 requires the Department of Housing and Community Development, in consultation with the Office of Planning and Research, to determine jobs-rich areas and publish a map of those areas by January 1, 2022.

SB30 (Cortese)

Senator Cortese’s SB30 would prohibit after January 1, 2022, the construction of a state building connected to the natural gas grid and prohibit state funding or other support for construction of residential and nonresidential buildings that are connected to the natural gas grid.

SB6 (Caballero, Eggman, Rubio)

SB6 is a second attempt to pass the Neighborhoods Homes Act that would override local prohibitions on residential uses on properties (no size limit) within any commercial zone, except where office uses and retail uses are not permitted or only permitted as an accessory use, that is not adjacent to an industrial use. Densities allowed fall into the range from 15 dwelling units/acre in rural areas to 30 dwelling units/acre in highly urbanized areas, with suburban areas allowing at least 20 dwelling units/acre. Housing development projects would still be subject to local zoning and parking controls, objective design review and permitting processes, and CEQA would be applicable. Projects taking advantage of the Neighborhoods Homes Act would be required to pay prevailing wages or use skilled and trained labor.

Authored by Reuben, Junius & Rose, LLP Attorney Justin A. Zucker.