Legislation Update, Part II: New Land Use Bills Under Consideration in the 2023 California Legislative Session

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June 2nd marked an important milestone in the 2023 California legislative session: it was the last day for each house of the legislature to pass bills introduced in that house.  Any bill that was passed in its house of origin by the deadline now moves to the other house for consideration.  All other bills are no longer under consideration in the 2023 legislative session. 

Part I of our legislative update discussed legislation proposed in the 2023 legislative session regarding the Density Bonus Law, accessory dwelling units, parking, the Surplus Land Act, and other laws. If you missed Part I, you can find it here.   All of the bills discussed in Part I were passed before the June 2 deadline, except an ambitious bill, AB 1532 (Haney), creating a by-right process for office-to-housing conversions, and two minor bills: AB 1661 (Bonta) exempting ADUs from utility meter requirements and AB 637 (Low) imposing limits on density bonus projects.  In addition, AB 1287 (Alvarez) was amended in committee to remove language that would have made the Density Bonus Law expressly applicable in the coastal zone notwithstanding the Coastal Act. 

Part II of our legislative update discusses other proposed legislation that met the June 2 deadline.  These bills propose to change SB 35, streamline affordable housing entitlements, alter the permitting and post-entitlement procedures for housing development, and refine other land use laws.

This large number of important land use-related bills will now continue through the legislative process, which requires that any bill must pass both houses no later than September 14, 2023 for the  bill will be sent to the Governor for either signing or veto.

A. SB 35

SB 423 (Wiener): Amendments to SB 35.

SB 35 mandates that local governments approve certain qualifying projects (including specified percentages of affordable housing) that satisfy objective development standards on a streamlined, ministerial basis.  SB 35 sunsets on January 1, 2026.  SB 423 would extend the sunset date to January 1, 2036.  SB 423 also would modify certain requirements of SB 35, including by making SB 35 applicable in the coastal zone.  SB 35 requires that construction workers be paid the prevailing wage and that all contractors utilize a “skilled and trained workforce” (i.e., typically a substantial percentage of union labor). SB 423 would eliminate the “skilled and trained workforce” requirement for projects that are 85 feet in height or less.

SB 423 is shaping up to be among the most controversial land use bills this year due to opposition by the California League of Cities and the State Building and Construction Trades Council.   

B. Affordable Housing

SB 4 (Wiener): Housing Development on Property Owned by Higher Education and Religious Institutions.

SB 4 would make a housing development project a use by right on any land owned by an independent institution of higher education or a religious institution.  The proposed project must satisfy specified criteria to qualify for streamlined approval, including that the project is not adjoined to any site where more than one-third of the square footage is dedicated to industrial use.  SB 4 would require that 100% of the units, exclusive of manager units, in the proposed project be affordable to lower-income households, except that 20% of the units may be for moderate-income households, and 5% of the units may be for staff of the independent institution of higher education or the religious institution that owns the land.  In addition, for any such projects with more than 10 units, all construction workers must be paid prevailing wages.  Any housing development project meeting the requirements of SB 4 would be subject to a ministerial approval process and therefore would be exempt from CEQA, notwithstanding any inconsistencies with the applicable zoning standards and general plan requirements.

C. Post-Entitlement Permits

AB 1114 (Haney): Post-entitlement Phase Permits for Housing Development Projects.

Existing law requires local agencies to determine whether an application for a post-entitlement phase permit (such as a demolition permit, building permit or permit for off-site improvements) requested for a housing development project is complete and to provide written notice of this determination to the applicant within 15 business days after the local agency receives the application.  AB 1114 would also provide that if the local agency determines that the complete application is compliant with the permit standards, the local agency must return the approved permit application within a specified period of time (30 business days for housing development projects with 25 units or less; 60 business days for housing development projects with 26 units or more).  AB 1114 further provides that the local agency may not subject the post-entitlement phase permit to any appeals or additional hearing requirements. AB 1114 would also expand the term “post-entitlement phase permit” to include all building permits or other permits issued under the California Building Standards Code or applicable local building code, whether discretionary or nondiscretionary.

D. Housing Litigation

AB 1485 (Haney): Intervention in Housing Litigation by HCD and the Attorney General.

AB 1485 would authorize both the state Department of Housing and Community Development (HCD) and the office of the Attorney General to intervene as a matter of unconditional right in any legal action to enforce the Housing Element Law, SB 35, the Housing Accountability Act, the Density Bonus Law, the Housing Crisis Act of 2019, and other housing laws.  With this amendment, courts would be required to permit each of the Attorney General and HCD to intervene in housing litigation without the need to establish that it has an interest in the matter that cannot be protected by the existing parties.

E. Other

AB 516 (Ramos): Increased Reporting and Auditing Requirements Under the Mitigation Fee Act.

AB 516 would amend the Mitigation Fee Act to impose new reporting and disclosure requirements as to revenue subject to the Act.  AB 516 would require each local agency to identify whether construction began on previously identified public improvements and, if not, explain the reason for the delay.  AB 516 would further expand the Mitigation Fee Act’s auditing provisions by requiring the local agency to inform a person paying a fee of their right to an audit and by expanding the scope of permitted audits.

AB 821 (Grayson): Expanded Rights to Enforce Zoning and General Plan Inconsistency.

AB 821 provides that if a zoning ordinance becomes inconsistent with the general plan and a local agency receives a development application that is consistent with the general plan but inconsistent with the zoning ordinance, the local agency must either amend the zoning ordinance within 180 days to ensure consistency or process the development application in accordance with the objective general plan standards (but not the inconsistent zoning standards).  AB 821 further would allow residents or property owners to bring a superior court action within 90 days after the local agency’s adoption of the zoning ordinance or its failure to comply with the bill’s rezoning requirement. 

It is worth noting that two controversial bills introduced in the Assembly failed to make it to the Assembly floor for a vote.  First, AB 1000 (Reyes) would have prohibited a local agency from approving logistics centers consisting of 100,000 or more square feet of building space within 1,000 feet of a sensitive receptor, such as a residence, school, or hospital.  AB 1000 failed to advance out of the Assembly Local Government Committee.  Second, AB 68 (Ward) would have created a streamlined and ministerial approval process for proposed residential and mixed-use projects in areas near transit and other urbanized areas.  At the same time, AB 68 would have created hurdles for developing housing outside of municipal boundaries and urbanized areas.  AB 68 failed to exit the Housing and Community Development Committee. 

The legislative process is fluid and bills can change throughout the legislative session. While this Client Alert summarizes the current version of these bills, the bills are not final.  We encourage you to consult with any of our experienced land use attorneys who are tracking these bills as they progress through the legislature.

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