The Court of Appeal recently provided a reminder that the courts can and will use their powers of equity to fashion interests in land belonging to another. In Tashakori v. Lakis, the owners of a landlocked undeveloped lot brought an action for rights of ingress and egress over a shared driveway on their neighbor’s property so they could access their property from the street. (196 Cal.App.4th 1003). The Court of Appeal upheld the lower court’s decision to create an equitable easement across a portion of the Lakises property, in this case the “burdened owner”, on behalf of the Tashakoris, or the “benefitted owner”. The Test The court applied a three part “relative hardship” test to determine whether an equitable easement would be created in this instance, without the burdened owner’s approval: First, the benefitted owner must be innocent. More specifically, his or her encroachment must not be willful or negligent. Here, the benefitted owner made a diligent and good faith effort to determine whether their lot had an easement to access the street. The court determined that the benefitted owner reasonably relied on inaccurate representations by the real estate broker and prior owner that such an easement existed benefitting their property. Second, unless the rights of the public would be harmed, the court should enjoin the encroachment if the burdened owner would suffer irreparable injury regardless of the injury to the benefitted owner. Here, the burdened owner never used the shared driveway and did not pay for the upkeep of the driveway. Furthermore, the shared driveway was used for ingress and egress by two other single family residences. Therefore, the court said that use by one additional family (the benefitted owner) would not provide a significant burden on the land on which it was located. Third, the hardship to the benefitted owner must be greatly disproportionate to the hardship caused to the burdened owner by the continuance of the encroachment and this fact must be proved by the benefitted owner. In this case, the benefitted owner proved they would be irreparably harmed because their lot would essentially be unusable as they would not be able to legally walk onto their own land. No Damages? The burdened owner not only appealed the decision granting the easement itself, but also the lower court’s decision not to award any damages to the burdened owner for granting such a property right to the benefitted owner. The Court of Appeal acknowledged that typically when the court creates an easement, the burdened owner is normally entitled to damages. However, in this case the burdened owner did not demonstrate that their property would suffer any diminishment in value as a result of permitting the benefitted owner to use their shared driveway to access the benefitted owner’s property. The Holding The Tashakori decision highlights that the courts will use their equitable powers to create property rights in lands of another, by weighing the level of harm to the parties. Furthermore, the courts will not necessarily compensate the burdened owner, unless such party can demonstrate actual damages. As San Francisco properties can have easements burdening and benefitting them, or more often than not no easements in place but a clear need to have access to a neighbor’s property (for example to do repairs or maintenance on a property where there is no side yard and the building is built to the property line), this case makes it clear that if necessary courts are willing to impose burdens on properties over the objection of their owners. Art Update The Planning Commission voted unanimously last week to recommend approval of the Chiu/Lee ordinance with the changes recommended by staff. Staff recommendations included elimination of art commission review for art included in development projects. They also make clear that any in lieu fee is an option to be exercised by developers, i.e. not mandatory. The Mayor and Sup. Chiu agreed to the changes. Staff also recommended that the fee be expanded to commercial developments over 25,000 s.f. in the Eastern Neighborhoods and South of Market districts. Representatives of the Mayor, Sup. Chiu, and the Arts Commission said they wanted time for more outreach before moving forward with this component. The Commission did not formally recommend the wider fee be included, but “strongly recommended that the Board consider” including a citywide art requirement that would apply to both residential and commercial developments larger than 25000 sq. ft. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.  

Responding to the concern that the rights of unit owners in a Common Interest Development (CID) to rent their units should be protected, the California legislature has enacted Senate Bill 150.  This new statute limits prohibitions on the rental of units in CID.  The new law will go into effect on January 1, 2012. Background A homeowners association (HOA) for a CID may generally impose reasonable restrictions on rental or leasing of units in the project, such as minimum lease periods, requiring that a copy of a lease be provided to an HOA, and requiring that a lease be subject to the project’s governing documents (such as CC&Rs, Bylaws and HOA Rules and Regulations).  Some HOAs have also adopted prohibitions on renting units in a project, including imposing a cap on the number of units that may be rented at any given time, or an outright prohibition of rentals. Many HOAs believe that such rental prohibitions ensure that residents have a stake in their community, promote maintenance of the property and preserve property values.  Moreover, Fannie Mae, Federal Housing Administration (FHA), and some banks and insurance providers, may also look at projects with high percentages of rentals in a negative light.  This may limit the ability to obtain mortgage financing for units in such projects or result in higher insurance rates. On the other hand, rental prohibitions may create hardships for unit owners who desire to rent their units when faced with family illness or death, job relocation, military service or other exigent circumstances.  In the current housing market, it may take time to sell a unit, requiring an owner to temporarily rent until the unit is sold.  Rental prohibitions may also prevent investors from buying and renting units, even when such investor-owners may help HOAs financially struggling due to owner bankruptcies and high vacancies.  SB 150 has been somewhat controversial, with legitimate concerns being expressed by HOAs, unit owners and other interested parties. The New Rules SB 150 adds Section 1360.2 and amends Section 1368 of the California Civil Code, part of the Davis-Stirling Common Interest Development Act.  The key points of SB 150 are: An owner of a CID unit shall not be subject to a restriction in a governing document that prohibits rental or leasing of that owner’s unit, unless such restriction was effective before that owner purchased his or her unit.  Such owner would be exempt from a rental prohibition that became effective after the owner purchased his or her unit. The exemption from such rental prohibition applies to an owner who purchased his or her unit before the restriction became effective.  Once the owner sells his or her unit, the new unit owner would be subject to such restriction.  However, certain transfers involving family members, probate, trusts and business entities would not cause an existing exemption to be lost. An owner who would otherwise not be subject to a rental prohibition may consent to be subject to the restriction. Owners are required to disclose the existence of any such rental prohibition to prospective purchasers before sale of a unit. A rental prohibition that becomes effective after January 1, 2012 will not apply to existing owners who purchased their unit before the restriction become effective – as the restriction was not in effect when they purchased their unit.  New owners purchasing after January 1, 2012 would be subject to such restriction – as the restriction was in effect when they purchased their unit. Since the new law is not effective until January 1, 2012, an HOA could impose a restriction and avoid the impact of SB 150 by modifying the project’s governing documents, so long as the restriction becomes effective before January 1, 2012.  The typical approach would an amendment to the project CC&Rs. If you have questions or would like further information on SB 150, please contact Jay Drake. Special thanks to law clerk Melinda Sarjapur for her research on this topic.   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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.

At long last, the proposed Planning Code amendments for the Western SoMa area plan were released earlier this month. Planning Code amendments are where the policies of the plan get translated in to cold, hard zoning rules that apply to properties within the plan area. The rezoning map remains the same as previous versions. New commercial districts will run along 9th and 10th Streets from just below Mission Street to Harrison Street. A new neighborhood commercial district will run along Folsom Street, the new “main street” of Western SoMa, from 7th Street to 10th Street. Remaining properties north of Harrison Street in the Western SoMa area will be rezoned to residential and mixed use districts. Most of the area below Harrison Street will be rezoned to SALI – an extremely restrictive zoning district similar to the PDR districts of the Eastern Neighborhoods Plan. The north side of Townsend Street from 4th to 7th Streets will be rezoned to an office mixed-use district. Some high-level highlights of the Planning Code amendments include: Office Use. Similar to the Eastern Neighborhoods Plan, office use (and all uses) is proposed to be principally permitted in all buildings designated as landmarks, contributory to a historic district, or eligible for the California Register. The one exception to this rule is in the SALI district. In non-historic buildings, office is permitted on either the first or second floor in the commercial districts above Harrison Street, permitted without limitation in the office mixed-use district, and not permitted in all other districts. Residential Use. Residential use is heavily encouraged north of Harrison Street. In the commercial districts, almost no non-residential uses are permitted above the second floor. In the residential districts, non-residential use is either prohibited or only allowed up to a 1:1 floor area ratio. In the general mixed use district, retail is also limited in most cases to 10,000 square feet. No density limits apply to residential uses in these districts. SALI District. As expected, the SALI district is looking very similar to the PDR districts that were created as part of the Eastern Neighborhoods Plan. In the SALI, residential and office uses are not permitted. Retail uses are only permitted up to 25,000 square feet with conditional use authorization. Industrial, entertainment and arts uses are the most unrestricted uses in the district. Eastern Neighborhoods Process and Fees. Projects within the Western SoMa plan area will be subject to Large Project Authorization from the Planning Commission, as was established by the Eastern Neighborhoods Plan. There are no proposed fees yet included in the Planning Code amendments, but it appears the Planning Department is considering applying the Eastern Neighborhoods fee to the Western SoMa area. Stabilization Policy. A stabilization policy has been an important goal of the Western SoMa task force since it was formed. Such a policy would “meter” the approval of new market rate project based on a maximum ratio of market rate to affordable housing and jobs to dwelling units. No stabilization policy has made its way into the proposed Planning Code amendments, and the staff report for the Planning Commission states that the Board of Supervisors is “requested” to enact such a policy after the Western SoMa Plan is approved. Design Standards. Area-specific design standards are proposed for the Western SoMa area. These standards will apply based on zoning district. There are also design standards that specifically apply to large site development. Adoption hearings for the Plan are scheduled for early 2012. We’ll keep you posted on the progress. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.    

Supervisor David Chiu has 344 pages of amendments (“Amendments”) in store for the San Francisco Planning Code. Many of these changes make good sense and will lower the procedural hurdles for transit-oriented development. However, the Amendments include yet another round of revisions to the City’s complex parking regulations. These changes threaten several projects – including those that have been approved or in the pipeline for years – with expensive new approval requirements. Many downtown parking lots would be put out of business with passage of the ordinance, and building owners could be required to remove parking entries to their buildings when making additions or changing uses above a certain size. The Planning Commission is scheduled to weigh in on these myriad changes on October 20th. GIVE AND TAKE ON RESIDENTIAL PARKING Since 2005, San Francisco has amended its parking rules nine times. Maximum parking limits have replaced minimum parking requirements in many of the dense neighborhoods in the northeast part of the City. In most districts, some minimal amount of residential parking is permitted “by right.” Additional parking-up to an absolute maximum-is allowed with Planning Commission, or in some cases, Zoning Administrator approval. In C-3 (Downtown) Districts, additional parking is approved as an “exception” as part of Section 309 permit review by the Planning Commission. Section 309 approvals are mandatory for all significant new construction downtown, so the parking exception is handled as part and parcel of applications required of any project. Requesting it doesn’t require separate applications or major fees, nor does it trigger new appeal rights that project opponents can use to stall a project. With Supervisor Chiu’s Amendments, “as-of-right” parking downtown will double from one space per four dwelling units to one space per two units. However, project sponsors will no longer be able to seek one-to-one parking for family-sized units, and a conditional use (“CU”) will be required to build the parking maximum of three spaces per four units. Within much of the Van Ness Special Use District, changes in the parking rules are more dramatic. Right now, one-to-one parking is required for residential projects and up to 1.5 spaces per unit are allowed by right. Under the legislation, maximum parking would be limited to one space per two units by right, or three per four units with a CU. The new CU requirement is consequential. It is among the most expensive entitlements; application fees are just shy of $100,000 for most sizable projects. The CU requirement will also make the approval process more convoluted and political. Unlike most entitlements, which are appealable to the Board of Appeals, a CU appeal goes to the Board of Supervisors. Because the Amendments lack a grandfather clause, projects that have already been approved but not broken ground could have to go back to the Planning Commission for a new approval and/or reduce the amount of parking they propose. Pipeline projects would be faced with similar new costs and procedural obstacles after months or years of Planning Department review. We understand that the Planning Department will be recommending a grandfather clause for approved projects downtown. However, to our knowledge, no relief will be recommended for projects on the Van Ness Corridor or pending downtown projects. As the City considers the tenth revision to its parking regulations in less than seven years, it should protect pending and approved projects from sudden changes in the ground rules. ON DOWNTOWN PARKING LOTS…JUST A TAKE With the adoption of the Downtown Plan in 1985, the City banned permanent surface parking lots downtown. However, existing parking lots were allowed to continue indefinitely. This longstanding provision would be eliminated, meaning that parking lots would be subject to immediate closure or be forced to seek a new conditional use to operate every two years. DRIVEWAY AND SIGN REMOVAL REQUIREMENTS Much of San Francisco’s building stock predates the Planning Code and many buildings do not comply with current zoning. For years, the Planning Code has allowed these buildings to be expanded or undergo a change in use, so long as there is no increase in the extent of noncompliance. This clear protection gives property owners certainty that upgrades will not trigger requirements to radically alter their buildings; it directly serves the City’s interest in providing for the adaptive reuse and upgrade of the City’s aging building stock. The Amendments reverse these clear, effective policies in several areas. For example, on the City’s 30+ protected streets where new parking entrances are limited or prohibited (i.e. transit preferential streets, bike lanes, etc.), the Planning Department “may” require project sponsors to remove or reduce the size of driveways or subbasements when certain additions or changes in use occur. There are, however, no criteria to guide planners in exercising this discretionary power. This is exactly the kind of uncertainty that will both discourage property owners from upgrading their buildings and create the impression-if not the reality-of arbitrariness in the planning process. In a similar vein, noncomplying signs, which can now remain until the end of their normal life, will have to be removed when the business associated with it ceases operation or moves. Code-complying business signs will have to be removed within 90 days of the business ceasing operation. OTHER CHANGES, MANY BENEFICIAL Though the Amendments have a number of problems, they do make beneficial changes to the Planning Code. For example, the residential density limit downtown will be eliminated, relieving many projects from a CU requirement. Affordable housing developments downtown will be exempted from the floor-area-ratio limit, again eliminating the need for an expensive CU. As well, the transfer of development rights would be more widely permitted among downtown use districts. NOTICE TO AFFECTED PARTIES To our knowledge, no formal city notice of the legislation has been given to project sponsors that could be affected by the new parking regulations or to parking lot operators who would be forced to close their businesses. The Planning Department’s concise summary of the legislation and recommended changes will not be available for public

On October 27, the Planning Commission will hear a proposed amendment to San Francisco Planning Code Section 429, which currently requires that any new building in the Downtown C-3 District of at least 25,000 feet include a work of art equal to at least 1% of the construction value onsite in a privately owned public open space, or onsite and clearly visible to the public, or on adjacent public property or, in the case of a hotel, in a publicly accessible lobby. The artwork to be provided must be permanent and not merely architectural detailing of building features. There are extensive “Fine Arts Guidelines” that further describe how the cost of the art is determined, the process for incorporating the art into the development, etc. In the 25 years since the adoption of the Downtown Plan, an average of about one project per year has added new art to what is now a permanent public gallery of lasting significance. Although the cost can be significant, most developers understand that the public art component of their project can be an enhancement contributing to the overall perception of quality of the building. Although there have been limited exceptions over the years allowing developers to direct these funds to alternative uses (the Dome at City Hall and restoration of the old Mint Building), in the absence of some compelling reason, developers would prefer that the money they spend on art remain associated with their projects. In July, the Mayor introduced an alternative ordinance which would amend Planning Code Section 429. The new ordinance would give developers an option to contribute all or a portion of the art fee to a City fund dedicated to support public art. The amendment would establish a Public Artwork Trust Fund funded through these contributions, which would pay for the creation, installation, exhibition, conservation, preservation and restoration of temporary and permanent public art. On its face, it would be hard to understand how any developer would freely elect to divert construction funding for art to some offsite use, not directly benefiting the project itself. However, the ordinance includes a new step in the Section 429 process whereby the Art Commission would be given jurisdiction to review all onsite art proposals. Since judgments regarding art are necessarily subjective, it is easy to see how the Art Commission’s review might be different and more critical than the existing process which includes a review only by the Planning Commission. In fact, the proposed amendments to the ordinance would invite the Art Commission to become an arbiter knowing that their negative reaction to an art proposal could cause the developer to pay in lieu moneys to the proposed newly formed “Public Artwork Trust” rather than continuing to attempt to provide the art onsite. The Planning Department is reviewing the proposed ordinance and will be providing comments at the hearing before the Planning Commission on October 27. While portions of the amendment may be well intended, the language and mechanics of the process include significant potential for arm twisting developers and project sponsors to divert their funding offsite. At a minimum, the option to elect to pay an in lieu fee ought to be entirely voluntary. The Planning Code Section 429 Art Program has been a success with the Planning Commission reviewing proposals. To date, the Art Commission has not been included in the review of art provided by project sponsors under San Francisco Planning Code Section 429. The addition of an Art Commission review adds time, expense, and uncertainty. Subjective review of the Art Program by the Art Commission could, in of itself, convince developers to offer all or a portion of their required 1% art budget to the newly created “Public Artwork Trust” rather than take on the uncertainty of a second Commission hearing. We will further report on the Planning Department’s recommendations and the results of the hearing at the Planning Commission on October 27. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.    

Right to Hire Survives Thankfully, Assembly Bill 350 (Solorio) has been defeated, and building owners will continue to be free to switch building service providers (janitorial, window cleaning, landscaping, etc.) without being held hostage by an existing relationship with a service provider. In our previous update of May 20, 2011, we warned that AB 350 would have placed incredible burden on commercial building owners to retain and pay the employees of an existing service provider for at least 90 days, even if the owner decided to hire a new company to perform the designated services. This legislation also mandated that any purchaser of commercial real estate retain the designated contractor’s employees. The new statute would have applied to hospitals, commercial properties, restaurants, grocery stores, and hotels. Oddly enough, the purported “right to work” goal of the statute could have put the employees of “new” service providers out of work. After a heavy lobbying effort that was led in large part by the California Building Owners and Managers Association, the bill was defeated on September 10th of this year. This is welcome news for the commercial real estate industry as this additional government mandate would have limited owners’ rights and stymied efforts to reduce operating costs. In this uncertain economic period, many people believed that AB 350 had the potential to further depress the market and result in additional job loss. Building Owners Must Disclose Energy Use The California Energy Commission has confirmed the implementation schedule for AB 1103. This statute requires non-residential building owners to disclose the energy benchmarking data and ratings for the most recent 12-month period to a prospective buyer, tenant of the entire building, or lender providing financing to the entire building. In our update of October 15, 2009, we informed you that the implementation of this requirement had been delayed to avoid potential negative impacts on pending real estate transactions. Even the California legislature realized that more regulations could harm the market’s recovery efforts. The Legislature delegated the implementation schedule to the California Energy Commission. Although the disclosure requirements are not complicated, owners should be aware of this additional item to add to the transactions checklist to avoid potential liability. Here is the implementation schedule: July 1, 2012 – Buildings with more than 50,000 square feet January 1, 2013 – Buildings with 10,001-49,999 square feet July 1, 2013 – Buildings with 5,000-10,000 square feet. Gas and electric companies are required to maintain the required records and upload the data to the US EPA’s ENERGY STAR Portfolio Manager. So, the information should be readily available by visiting this website (www.energystar.gov) and setting up the building’s account. The California Energy Commission has also published a helpful flowchart for accessing the information on its website at www.energy.ca.gov/ab1103/documents/index.html. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.    

Making it easier to rebuild nonconforming uses This week the Planning Commission is considering amendments to Planning Code Section 181(d), clarifying procedures that will apply to rebuilding of nonconforming uses destroyed by fire or other calamity. Generally speaking, nonconforming uses cannot be enlarged, intensified or relocated under longstanding provisions of the Planning Code. However, there has always been the recognition that nonconforming uses destroyed by fire or other calamity could be rebuilt to their existing size and nonconforming use, so long as the rebuilding started quickly. Current Planning Code Section 181(d) states that an owner may restore the former nonconforming use “provided that such restoration is permitted by the Building Code, and is started within one year and diligently prosecuted to completion.” It has never been very clear as to what “starting a project within one year” really means. These welcome amendments will provide some guidance and flexibility for owners placed in a difficult spot as a result of severe damage to their property. If adopted, following a fire or other event that destroyed an owner’s nonconforming use, the owner will be able to continue the nonconforming use so long as within one year they either (1) file an application for a building permit for alteration, repair or replacement for the damaged or destroyed building, or (2) submit to the Planning Department evidence of a resolution with the owner’s insurance company accompanied by a schedule of payments to the owner and a commitment by the insurance company to pay, or (3) submit to the Planning Department plans and evidence of efforts to the owner to conduct pre-application review with the Department of Building Inspection or the Planning Department. This covers pretty much everything an owner would likely be doing if they were serious about re-building quickly, which is what the City wants. For those unfortunate enough to be in the situation where they have been struck by a fire or other disaster that destroys their building, these provisions will make it much easier to preserve the nonconforming use going forward without the possible draconian cutoff of “starting a restoration within one year.” The Planning Department is recommending that the Commission support these changes and we hope they do. HPC Update Today the Historic Preservation Commission continues its review of changes to Articles 10 & 11 of the Planning Code. These portions of the Planning Code contain specific zoning provisions that apply to historic buildings throughout San Francisco. This effort ran aground several years ago after the passage of Proposition J which created the HPC. Since its creation, the HPC procedures have been somewhat in limbo pending the amendments to Articles 10 & 11. This time around, it looks like they might get it done. Review of Articles 10 & 11 by the Planning Commission will follow the HPC’s review. As we get closer to get final adoption, we will keep you informed of any major changes to Articles 10 & 11. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.    

After a summer hiatus, the R&J update is back, ready to provide you with the latest on land use and real estate law and developments in San Francisco and the Bay Area. This week, we provide an update on the Redevelopment dissolution fight and the status of the West SoMa Plan. Supreme Court to Hear Challenge to Redevelopment Dissolution, Laws Mostly Stayed for Now As expected, the newest stage of the Redevelopment dissolution fight is in the courts. On August 11, the California Supreme Court agreed to hear a challenge to the two bills the California Legislature passed and the Governor signed in June. To recap, the first bill effectively dissolved all Redevelopment Agencies in the state, effective October 1, 2011. The second bill allowed Redevelopment Agencies to continue past that date if they make massive annual payments to the state. The California Redevelopment Association and the League of California Cities, among others, brought a lawsuit challenging the bills. In addition to agreeing to consider the suit, the Supreme Court stayed the first bill, with the exception of the provisions prohibiting an agency from taking on additional liabilities, and stayed the entirety of the second bill. The court agreed to an expedited calendar and expects to rule on the suit by January 15, 2012. Effectively, Redevelopment Agencies will continue to exist on October 1. However, it is likely that those agencies that have passed continuation resolutions with the expectation of making a payment to the state and remaining in existence will be barred from taking on additional liabilities or conducting new business until the lawsuit is resolved. In local Redevelopment news, Fred Blackwell, director of the San Francisco Redevelopment Agency, has agreed to take a position with his hometown of Oakland as its Assistant City Administrator. He will oversee the Community and Economic Development Agency (which houses Oakland’s Planning and Building Departments) as well as several other departments. Planning Commission Begins to Consider Western SoMa Plan Anyone looking at the Eastern Neighborhoods Area Plan map will notice a big hole between Eastern South of Market area and the Mission/Showplace Square/Central Waterfront areas. This was due to the fact that during the Eastern Neighborhoods rezoning process the Western South of Market community got the Board of Supervisors (with a big push by then Supervisor Daly) to agree to remove the West SoMa area from the larger rezoning so it could go through its own, unique rezoning process. That process has continued on for several years now, and the Planning Department is gearing up for its ultimate adoption, likely in early 2012. In preparation for that event, the Planning Commission is holding two hearings this month and next on the West SoMa plan. Last week, the Commission considered the current version of the West SoMa community plan. Proposed rezoning districts appear to have remained relatively the same from the previous draft of the community plan. Those areas above Harrison Street are generally zoned for mixed use and neighborhood commercial uses. Most areas below Harrison Street fall within an art and industrial zone where residential and office uses are not permitted and arts and industrial uses are encouraged. The north side of Townsend Street between Fourth and Seventh Streets is proposed to be rezoned to encourage new office uses. As for height limits, much of the West SoMa area is currently zoned for heights between 40 and 50 feet. Much of the area above Harrison Street is proposed for heights of up to 65 feet. The north side of Townsend Street is zoned for heights of up to 85 and 95 feet. The expanded office use controls and higher height limits along Townsend Street are planned to accommodate high tech and other office uses located near the CalTrain station. The plan also calls for some unique zoning proposals. On large development sites, projects can take advantage of increased height limits if community benefits such as open space, child care facilities and streetscape improvements are provided. In the art and industrial districts below Harrison Street, projects can take advantage of increased height limits if ground floor space for arts uses are provided for the life of the project. The Community Plan includes no significant discussion of the proposed stabilization policy that the Board of Supervisors considered earlier this year. In an earlier update, we reported that the stabilization policy adopted by the West SoMa community task force called for placing strict limitations on development when certain ratios of market rate housing to affordable housing and the number of jobs to the number of housing units were exceeded. The Board of Supervisors adopted a watered-down resolution, urging the Planning Commission “to ensure that policies to maintain the historical balance between affordable and market rate housing and the jobs/housing mix are incorporated into the Western SoMa Community Plan.” More details on this policy should be forthcoming during the adoption process. Next month, the Planning Commission will hold an informational hearing on the Planning Code amendments related to the West SoMa Plan. This will be the first time the public will see the actual Planning Code changes, which will set use controls, development fee amounts, and design controls for the area. We’ll update you when the amendments are provided. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.    

Throughout the Bay Area and state, subdivisions and condominium projects have been delayed during the downturn in housing construction over the past few years. Many residential and mixed-use projects have stalled in the middle of the mapping and entitlement process, before the project’s map has been recorded. Delayed maps are at risk of expiration, with the potential loss of vital project approvals and permits. In recognition of these critical issues, and in an effort to bolster the housing industry, the California legislature enacted a new law to enable developers to extend the life of tentative and parcel maps and related state agency approvals until such time as developers are able to complete such stalled projects. The law was signed by the Governor last week and takes effect immediately. Tentative Map Extension Assembly Bill 208, enacted on July 15, 2011, extends for 2 years any existing unexpired tentative map, vesting tentative map or parcel map that would have otherwise expired before January 1, 2014. To be eligible for the extension, a map must have been valid on July 15, 2011, and set to expire before January 1, 2014. The 2 year extension is in addition to any other extensions provided under state law or local ordinance. For those maps extended by 2009’s similar state measure, AB 208 will provide an additional 2 year extension. See Cal. Govt. Code Section 66452.23. Related State Agency Approvals Also Extended Important for those projects receiving other state agency approvals, such as a San Francisco Bay Conservation and Development Commission Permit or California Coastal Commission Coastal Development Permit, the new law also extends for 2 years related state agency approvals for those projects that extend their maps under AB 208. Local City & County Approvals Not Included AB 208 only applies to tentative maps, vesting tentative maps, parcel maps and related state level approvals. The new law does not extend local city or county approvals or permits. Conditional Use Permits, Variances, Special Use Permits, building permits and other local approvals remain subject to local regulations with respect to expiration periods and available extensions, if any. However, in San Francisco the Planning Commission has extended certain existing local approvals for some projects. Interested property owners or developers should contact Andrew Junius concerning San Francisco project approvals that may be eligible for an extension. The Trade-Off For those projects utilizing the 2 year map extension under AB 208, there are a few trade-offs. In order to offset potential adverse impacts on local cities or counties from multiple extensions of tentative or vesting tentative maps, AB 208 modifies Cal. Govt. Code Section 65961 by (i) reducing from 5 years to 3 years the period of time after recordation of a map during which a city or county is prohibited from imposing new conditions on a building permit if such conditions could have been imposed as conditions of the previously approved tentative or vesting tentative map, and (ii) eliminating the prohibition on a city or county imposing new local fees upon the issuance of a building permit. If you have any questions or would like further information on AB 208 and its applicability to a particular project or map, please contact Jay Drake.   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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.    

Recognizing Economic Climate, Oakland Provides Blanket Entitlement Extensions Late last month, the Oakland City Council enacted an extension of all non-expired entitlements in the city through December 31, 2012.  The Council’s action extends a previous citywide extension of entitlements in the City that was to expire December 31 of this year. Councilmembers Brunner and De La Fuente, sponsors of the resolution, cited the continuing weak housing and credit market in support of the measure.  The councilmembers acknowledged that, faced with the prospect of re-entitling a project, builders may instead choose not to develop a property, leaving a dilapidated or underused lot in place.  Ultimately, they recognized that “when an entitled project is built, it results in many benefits for the community and the City,” including new housing, jobs, infrastructure and taxes. The extension applies to all entitlements granted under the Planning Code as well as creek protection permits.  Take note, however, that existing entitlements are not automatically extended.  A project sponsor must submit a request with the City and pay an administrative extension fee of $450.97.  The extension will not apply to properties that have been issued a citation pursuant to the City’s blighted property ordinance. This is one area where San Francisco could follow Oakland’s lead.  The San Francisco Planning Commission has heard a number of entitlement extensions since the economic downturn in 2008 – some projects having requested an extension several times now. San Francisco Planning Commission Adds Flexibility to Affordable Housing Requirements The San Francisco Planning Commission is also to be commended this week for making a common-sense policy change to its affordable housing program.  Last night, the Commission approved a resolution that delegates to the zoning administrator the authority to administratively approve a project sponsor’s request to change the way they comply with the affordable housing program.  This removes the costly and timely step of having to go to a public hearing before the Planning Commission for such a move. Last year, the Board of Supervisors amended the affordable housing program to comply with the recent Palmer decision.  Among other things, it gave a project sponsor of a residential project who has elected to provide below-market rate units on- or off-site the ability to instead pay the affordable housing fee up to the date that building or site permit addendum is pulled without obtaining Planning Commission approval.  In an effort to encourage on-site below-market rate units to be built, the policy adopted last night would allow a project sponsor who has chosen to pay the affordable housing fee the ability to build for-sale below-market rate units on-site instead, without Planning Commission approval.  The zoning administrator can approve this move administratively, which would be subject to appeal to the Board of Appeals.  Project sponsors would have this option all the way up to the first building permit or site permit addendum being pulled. In addition, project sponsors of residential projects that were entitled prior to January 24 of this year (the date the affordable housing program amendments went into effect) did not have the option of paying the affordable housing fee after they had elected to provide on- or off-site below-market rate units.  The policy would also allow projects entitled prior to January 24 to switch from providing on- or off-site units to paying the affordable housing fee. This policy shift will provide more flexibility to project sponsors and will avoid spending unnecessary time on a Planning Commission hearing for a relatively modest change to a project.  And the Planning Commission could use the break – they didn’t conclude their meeting until 10 p.m. last night – after starting in closed session at 10:30 a.m! Updated Census Numbers Confirm Housing Growth in Districts 6, 10 and 11 The Planning Department has crunched the latest 2010 Census numbers and are now able to provide information on population growth in the city by supervisorial district.  As expected, District 6, consisting of South of Market and Mission Bay, was the fastest growing district over the past decade, adding 24,590 people.  Districts 10 and 11, covering the Bayview, Potrero Hill, Visitacion Valley, Excelsior, and other neighborhoods grew the next fastest, with roughly 5,400 new residents each.  The greatest population loss occurred in District 9, consisting of Bernal Heights and parts of the Mission and the Excelsior.  It shrank by 5,370 people. All of this data will pave the way for redistricting the supervisorial districts next year.  Earlier this month, Mayor Lee appointed the final members of the nine-person resdistricting task force.  The group must present its redistricting plan by April of 2012. 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, 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. Copyright 2011 Reuben & Junius, LLP. All rights reserved.