SB 10: The bill text can be found here.
| Author: |
Scott D. Wiener (D-011) |
| Coauthor |
Caballero (D), Atkins (D), Rivas R (D) |
| Title: |
Planning and Zoning: Housing Development: Density |
| Fiscal Committee: |
yes |
|
| Urgency Clause: |
no |
|
| Introduced: |
12/07/2020 |
| Last Amend: |
04/27/2021 |
| Disposition: |
Pending |
| Committee: |
Senate Appropriations Committee |
| Hearing: |
05/10/2021 10:00 am, John L. Burton Hearing Room (4203) |
| Summary: |
Authorizes a local government to pass an ordinance to zone any parcel for up to 10 units of residential density per parcel, at a height specified in the ordinance, if the parcel is located in a transit-rich area, a jobs-rich area, or an urban infill site, as those terms are defined. Requires the Department of Housing and Community Development to determine jobs-rich areas and publish a map of those areas on a certain frequency. |
2021 CA S 10: Bill Analysis - 04/20/2021 - Senate Governance and Finance Committee
SENATE COMMITTEE ON GOVERNANCE AND FINANCE
Senator Mike McGuire, Chair
2021 - 2022 Regular
Bill No: SB 10 Hearing Date: 4/22/21
Author: Wiener Tax Levy: No
Version: 4/13/21 Amended Fiscal: Yes
Consultant: Favorini-Csorba
Planning and zoning: housing development: density
Allows a local legislative body to upzone specified parcels for up to 10 units per parcel.
Background
Planning and approving new housing is mainly a local responsibility. The California Constitution allows cities and counties to "make and enforce within its limits, all local, police, sanitary and other ordinances and regulations not in conflict with general laws." It is from this fundamental power (commonly called the police power) that cities and counties derive their authority to regulate behavior to preserve the health, safety, and welfare of the public--including land use authority.
Planning and Zoning Law. State law provides additional powers and duties for cities and counties regarding land use. The Planning and Zoning Law requires every county and city to adopt a general plan that sets out planned uses for all of the area covered by the plan. A general plan must include specified mandatory "elements," including a housing element that establishes the locations and densities of housing, among other requirements. Cities' and counties' major land use decisions--including most zoning ordinances and other aspects of development permitting--must be consistent with their general plans. The Planning and Zoning Law also establishes a planning agency in each city and county, which may be a separate planning commission, administrative body, or the legislative body of the city or county itself. Cities and counties must provide a path to appeal a decision to the planning commission and/or the city council or county board of supervisors.
Zoning and approval processes. Local governments use their police power to enact zoning ordinances that establish the types of land uses that are allowed or authorized in an area. Zoning often identifies a primary use for parcels in the area, as well as other uses that are allowed if they meet conditions imposed by the local government. Zoning ordinances also contain provisions to physically shape development and impose other requirements, such as setting maximum heights and densities for housing units, minimum numbers of required parking spaces, setbacks, and lot coverage ratios. These ordinances can also include conditions on development to address aesthetics, community impacts, or other particular site-specific considerations.
Some housing projects can be permitted by city or county planning staff "ministerially" or without further approval from elected officials. Projects reviewed ministerially require only an administrative review designed to ensure they are consistent with existing general plan and zoning rules, as well as meet standards for building quality, health, and safety. Most large housing projects are not allowed ministerial review. Instead, these projects are vetted through both public hearings and administrative review, including design review and appeals processes.
The California Environmental Quality Act (CEQA) requires public agencies to analyze and, where feasible, mitigate significant effects on the environment from a proposed "project." Most zoning ordinances are considered "projects" under CEQA, and most individual housing development projects that require discretionary review and approval are also subject to CEQA. CEQA does not apply to projects permitted ministerially.
Local initiative power. The California Constitution also provides that all political power is inherent in the people, and that the initiative is the power of electors to propose statutes and amendments to the Constitution and to adopt or reject them. Statewide initiatives require majority voter approval (Article II, Section 10). The Constitution also allows initiative and referendum powers to be exercised by the electors of each city or county under procedures developed by the Legislature. Charter cities and charter counties may adopt alternative procedures for initiatives.
HOAs. The Davis-Stirling Common Interest Development Act governs the management and operation of common interest developments (CIDs). CIDs (often colloquially referred to as Homeowners Associations, or HOAs, after the entity that governs them) are self-governing forms of real estate in which each homeowner has an exclusive ownership in a unit and a shared stake in common areas and amenities. HOAs come in a wide variety of physical formats: condominium complexes, apartment buildings, and neighborhoods of detached, single-family residences, for example. The owners of the separate properties within the common interest development are the members of it. Each member is subject to the covenants, conditions, and restrictions that govern the development, as well as annual assessments that pay for communal expenses. Units within common housing developments currently account for approximately a quarter of the state's overall housing stock, meaning that the laws governing such development have a large impact on the population.
In addition to the requirements of the Act, each CID is governed according to the recorded declarations, bylaws, and operating rules of the association, collectively referred to as the governing documents. HOAs often impose restrictions on the use of property within the CID, ranging from aesthetic requirements to structural modifications and beyond. However, the Act voids any governing documents and covenants that effectively prohibit or unreasonably restrict various types of activities or improvements, including accessory dwelling units, electric vehicle charging stations, solar panels, and others. However, HOAs can impose reasonable restrictions on these types of improvements that don't make it too difficult to construct them.
California's housing challenges. California faces a severe housing shortage. In its most recent statewide housing assessment, HCD estimated that California needs to build an additional 100,000 units per year above recent averages of 80,000 units per year to meet the projected need for housing in the state. Prior to the onset of COVID-19, California was building approximately 100,000 to 115,000 units a year in recent years, but many analysts expect homebuilding activity to drop.
A variety of causes have contributed to the state's lack of housing production. Recent reports by the Legislative Analyst's Office (LAO) and others point to local approval processes as a major factor. They argue that local governments control most of the decisions about where, when, and how to build new housing, and those governments are quick to respond to vocal community members who may not want new neighbors. The building industry also points to CEQA review, and housing advocates note a lack of a dedicated source of funds for affordable housing.
This shortage has driven up housing prices and resulted in overcrowding within existing homes. According to a January 2020 report by the Public Policy Institute of California, "the share of Californians with excessive housing costs is quite high: 38 percent of mortgaged homeowners and 55 percent of renters spend more than 30 percent of their total household income on housing, compared with 28 percent and 50 percent nationwide.... California's rate of overcrowding--the share of housing units with more than one resident per room--was 8.3 percent in 2018, well above the national rate of 3.4 percent. Overcrowding is especially high for rental units: at 13.4 percent, it is more than twice the national rate and the highest in the nation."
COVID-19 effect on housing. The COVID-19 pandemic has only exacerbated California's housing challenges. According to the California Association of Realtors' January 2021 home sales and price report, the median home price in California jumped by almost 22 percent from January 2020 to January 2021, in part due to reluctance of sellers to list homes during the pandemic. At the same time, as many Californians became unemployed due to the pandemic, more individuals at risk of homelessness have fallen into homelessness. The Legislative Analyst's Office notes in a January 2021 post, "Even before the pandemic, the high cost of housing in California placed renter households in a precarious position, particularly the 1.5 million low-income households who pay at least half of their income in rent. A pandemic-induced job loss adds further financial stress to these households. Due to the composition of the industries and occupations most affected by public health restrictions and declining economic activity, renter households have faced higher rates of job loss during the pandemic because job losses have been concentrated among lower-wage workers who are much more likely to rent than higher-wage workers."
The author wants to increase the number of units that can be permitted in residential areas.
Proposed Law
Senate Bill 10 allows a local government to adopt an ordinance to zone a parcel for up to 10 units of residential density per parcel if the parcel is located in any of the following areas:
* A transit-rich area, defined to be a parcel within one-half mile of a major transit stop or a parcel on a high-quality bus corridor that meets certain conditions for the frequency of service;
* A jobs-rich area, which is an area identified by the Department of Housing and Community Development (HCD) as being both associated with positive educational and economic outcomes for households of all incomes and close to jobs, as defined. HCD must develop a map of jobs-rich areas by January 1, 2023 based off specified existing maps developed by HCD, and updated them every five years; or
* An urban infill site, meaning a site that is a legal parcel that:
* Is located in an urbanized area or urban cluster, as defined by the United States Census Bureau, or in a city where any part of the city is an urbanized area or urban cluster;
* Has at least 75 percent of its perimeter adjoining parcels that are developed with urban uses; and
* Has a general plan or zoning designation for residential use or mixed use.
SB 10 grants this authority to local legislative bodies regardless of any local restrictions on adopting zoning ordinances enacted by the jurisdiction, and provides that an ordinance, resolution, or other local regulation, including general plan amendments, to effectuate the bill is not a project for the purposes of CEQA.
SB 10 also voids any covenant, restriction, or condition affecting the sale of any interest in a CID, and any provision of a CID governing document, that effectively prohibits or unreasonably restricts a use or density authorized by an ordinance adopted under the bill. The bill says that it doesn't apply to restrictions that do not make infeasible a development authorized by an SB 10 ordinance.
SB 10 doesn't apply to parcels located within a High Fire Hazard Severity Zone or Very High Fire Hazard Severity Zone (VHFHSZ), but does apply to parcels if they have been excluded from those zones by a local agency or if the site has adopted mitigation measures required by the building code or state law.
To use SB 10's authority, a local legislative body must comply with the following requirements:
* The zoning ordinance must include a declaration that it is adopted using the authority in this bill.
* The zoning ordinance must clearly demarcate the areas that are zoned using the authority in this bill.
* The legislative body must make a finding that the increased density authorized by the ordinance is consistent with the city or county's obligation to affirmatively further fair housing under existing law.
Additionally, a legislative body that upzones a parcel using SB 10 cannot subsequently reduce the density on the parcel.
SB 10 defines its terms and includes findings and declarations to support its purposes.
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill. According to the author, "California's massive housing shortage is driving people into poverty and homelessness and threatening our environment, economy, and diversity. SB 10 provides cities with a powerful, fast, and effective tool to allow light-touch density exactly where it should be: near jobs, near public transportation, and in existing urbanized areas. Specifically, SB 10 allows cities, if they choose, to rezone these non-sprawl location for up to ten-unit buildings in a streamlined way without CEQA. Given that cities face significantly increased housing production goals under the revised Regional Housing Needs Assessment (RHNA) and are required by the state Housing Element Law to complete rezonings to accommodate these goals, SB 10 is a powerful new tool for cities to use in their comprehensive planning efforts. SB 10 will help ease California's housing crisis, spurred by a statewide shortage of 3.5 million homes, and move the state away from a sprawl-based housing policy and toward a more sustainable, equitable, and effective housing policy."
2. Local officials know best? In 1911, California voters amended the Constitution to provide voters the power to enact initiatives and referenda. The voter initiative is a 'reserved power;' it is not a right granted to them, but a power reserved by them. As such, the power of initiative is integral to California's political process. One common way the initiative power is used is to adopt urban growth boundaries or other growth management ordinances. Voters adopt these measures for a variety of reasons, some more noble than others. For example, some are adopted out of environmental concerns, such as preventing sprawl or reducing pressure to convert agricultural land to urban uses, while others are intended to block new neighbors from moving in. SB 10 allows local officials to adopt zoning that allows up to 10 units on a parcel, even if local voters have said they don't want it. In the same vein, SB 10 also voids some CID restrictions and governing documents, which are contracts willingly entered into by individuals. Should politicians be able to override the preferences of local voters and of homeowners that willingly enter into contracts that restrict the use of their property?
3. Who speaks for the trees? Although the current prevailing wisdom in land use scholarship is that local governments are not permissive enough towards new housing, it wasn't that long ago that city and county officials were assumed to be too willing to permit development--and trash the environment in doing so. SB 10 allows city councils and boards of supervisors to override local growth management ordinances that were put in place in part to rein in past abuses. In fact, the bill goes further by exempting local agencies from complying with CEQA as they adopt zoning ordinances, meaning they won't be compelled to analyze the environmental impacts of their decisions. If a local government adopts an SB 10 ordinance that allows ministerial approval of projects, local officials could permit development that receives no environmental review at any level. With that said, SB 10 is limited to areas that are either jobs-rich, transit-rich, or infill, so residential development is likely to have been contemplated for these areas. Will local officials use SB 10 in ways that undermine other state priorities in order to build housing?
4. Location, location, location. SB 10 allows local governments to upzone in some areas of the state that Californians have traditionally considered to be worthy of protection. In particular:
* California voters adopted the Coastal Act of 1976, which regulates development in the coastal zone to protect coastal resources and ensure coastal access. SB 10 applies to parcels in the coastal zone. However, SB 10 provides a safeguard by stating that nothing in the bill can be construed to supersede or in any way alter or lessen the effect or application of the Coastal Act.
* SB 10 borrows from an existing prohibition on developing in the Very High Fire Hazard Severity Zone (VHFHSZ). However, that prohibition allows development if the project meets state fire mitigation requirements, so SB 10's provisions are not a blanket ban on the use of the bill's authority in these areas.
* SB 10's transit-rich and jobs-rich provisions apply to both infill and greenfield parcels, as long as they meet the other requirements in the bill.
Some previous legislation in the housing production space, such as SB 50 (Wiener, 2019), excluded these areas from some parts of the bill. On the other hand, SB 50 allowed for much larger developments that have the potential for larger impacts in these areas. Furthermore, automatically excluding parcels in these areas at the state level would reduce the overall housing production that is likely to result from the bill. Finally, the authority in SB 10 is voluntarily exercised by local officials, who may be best positioned to evaluate any potential harms of upzoning in their own jurisdictions. The Committee may wish to consider the manner in which SB 10 balances the need for housing production against concerns about sensitive areas.
5. Let's get technical. SB 10 prohibits the use of the bill in the VHFHSZ, but allows it to be used in those areas under certain conditions, including if the local agency has excluded an area from the VHFHSZ. However, the Legislature repealed the ability of locals to remove areas from the VHFHSZ in 2018 (SB 1260, Jackson). The Committee may wish to amend SB 10 to strike the provision that refers to this repealed ability, as follows:
* On page 4, line 18, strike, "parcels excluded from the specified hazard zones" and strike line 19.
6. Charter city. The California Constitution allows cities that adopt charters to control their own "municipal affairs." In all other matters, charter cities must follow the general, statewide laws. Because the Constitution doesn't define "municipal affairs," the courts determine whether a topic is a municipal affair or whether it's an issue of statewide concern. SB 10 says that its statutory provisions apply to charter cities. To support this assertion, the bill includes a legislative finding that it ensuring access to affordable housing is a matter of statewide concern.
7. Incoming! The Senate Housing Committee approved SB 10 at its March 18th meeting on a vote of 7-1. The Senate Governance and Finance Committee is hearing SB 10 as the committee of second reference. The Senate Rules Committee also ordered a third referral of SB 10 to the Senate Environmental Quality Committee. However, due to the ongoing health and safety risks of the COVID-19 virus, the referral to Environmental Quality was rescinded.
8. Related legislation. SB 902 (Wiener, 2020) was substantially similar to SB 10. SB 902 was referred to the Senate Governance and Finance Committee, but that referral was rescinded due to the COVID-19 pandemic. SB 902 died in the Assembly Appropriations Committee.
SB 10 is part of the Senate's housing package, along with the following bills:
* SB 5 (Atkins), which authorizes the issuance of $6.5 billion in general obligation bonds intended to finance housing-related programs that serve the homeless and extremely low income and very low income Californians. SB 5 is currently pending in the Senate Housing Committee and is double-referred to the Senate Governance and Finance Committee.
* SB 6 (Caballero), which enacts, until January 1, 2029, the Neighborhood Homes Act, to establish housing as an allowable use on any parcel zoned for office or retail uses. The Senate Governance and Finance Committee approved SB 6 at its March 11th hearing on a vote of 5-0. SB 6 is set for hearing on April 29th in the Senate Housing Committee.
* SB 7 (Atkins), which reenacts the Jobs and Economic Improvement Through Environmental Leadership Act of 2011 (AB 900, Buchanan) to allow for streamlined judicial review of large projects that meet high environmental and labor standards. SB 7 also allows a housing project with at least 15% of its units affordable to lower income households and a minimum investment of $15 million and that meets other criteria to use the same streamlining provisions. SB 7 is currently pending in the Assembly Natural Resources Committee.
* SB 8 (Skinner), which extends the sunset on the Housing Crisis Act of 2019 by five years, to January 1, 2030, and makes other changes. The Senate Governance and Finance Committee approved SB 8 at its March 25th hearing on a vote of 5-0. SB 8 is set for hearing on April 29th in the Senate Housing Committee.
* SB 9 (Atkins), which requires ministerial approval of duplexes and specified parcel maps. SB 9 is also scheduled to be heard at the Committee's April 22nd hearing.
Support and Opposition
(4/19/21)
Support: Libby Schaaf- Mayor, City of Oakland; Zach Hilton-City Council Member, City of Gilroy; AARP; Abundant Housing LA; American Planning Association, California Chapter; Association of Bay Area Governments; Bay Area Council; Bridge Housing Corporation; Calchamber; California Apartment Association; California Association of Realtors; California Community Builders; California Rental Housing Association; California Yimby; Cbia; Chan Zuckerberg Initiative; Circulate San Diego; Council of Infill Builders; East Bay for Everyone; Facebook, INC.; Generation Housing; Greenbelt Alliance; Habitat for Humanity California; Housing Action Coalition; Long Beach Yimby; Los Angeles Business Council; Metropolitan Transportation Commission; Monterey; County of; Mountain View Yimby; Non-profit Housing Association of Northern California; North Bay Leadership Council; Northern Neighbors; Peninsula for Everyone; People for Housing - Orange County; San Fernando Valley Yimby; San Francisco Bay Area Planning and Urban Research Association; San Francisco Bay Area Rapid Transit District; Santa Barbara Women's Political Committee; Santa Cruz Yimby; Silicon Valley Community Foundation; South Bay Yimby; South Pasadena Residents for Responsible Growth; Southwest California Legislative Council; Streets for People Bay Area; Sv@home; Techequity Collaborative; The Two Hundred; United Way of Greater Los Angeles; Urban Environmentalists; Valley Industry and Commerce Association; Yimby Action; Yimby Democrats of San Diego County; Zillow Group
Opposition: A Better Way Forward to House California; Adams Hill Neighborhood Association; Aids Healthcare Foundation; Alameda Citizens Task Force; Berkeley Associated Neighbors Against Non-affordable Housing; Brentwood Homeowners Association; Burton Valley Neighborhoods Group; California Alliance of Local Electeds; California Cities for Local Control; California Labor Federation, Afl-cio; California Land Title Association; California State Association of Electrical Workers;
California State Pipe Trades Council; Citizens Preserving Venice; City of Agoura Hills; City of Beverly Hills; City of Cupertino; City of El Segundo; City of Hidden Hills; City of Lafayette; City of Lomita; City of Orange; City of Rancho Palos Verdes; City of Redondo Beach; City of San Dimas; City of Santa Monica;
City of Torrance; City of Yorba Linda; Coalition for San Francisco Neighborhoods; College Terrace Residents Association; Commitee to Save the Hollywoodland Specific Plan; Comstock Hills Homeowners Association; Cow Hollow Association; D4ward; Durand Ridge United;
Federation of Hillside and Canyon Associations; Hidden Hill Community Association; Hills 2000 Friends of The Hills; Hollywood Knolls Community Club; Hollywoodland Homeowners Association, United Neighborhoods; IBEW Local Union 569; International Union of Elevator Constructors; LA Brea Hancock Homeowners Association; Lafayette Homeowner's Council; Lakewood Village Neighborhood Association; Latino Alliance for Community Engagement; Linda Vista-annandale Association; Los Feliz Improvement Association; Miracle Mile Residential Association; Mission Street Neighbors; Neighborhood Council Sustainability Alliance Trees Committee; New Livable California Dba Livable California; Noma; Northeast Neighbors of Santa Monica; Pacific Palisades Community Council; Palo Alto; City of; Pleasanton; City of; Resident Information Resource of Santa Monica; Riviera Homeowners Association; Santa Monica Coalition for A Livable City; Save Lafayette; Seaside Neighborhood Association; Shadow Hills Property Owners Association; Sherman Oaks Homeowners Association; Sierra Club; South Bay Cities Council of Governments; South Shores Community Association; Southwood Homeowners Association; Southwood Riviera Neighborhood Association; State Building and Construction Trades Council of Ca; Sunnyvale United Neighbors; Sunset-parkside Education and Action Committee; Sustainable Tamalmonte; Sutro Ave Block Club; Telegraph Hill Dwellers; Temecula Valley Neighborhood Coalition; Verdugo Woodlands West Homeowners Association; West Pasadena Residents' Association; West Torrance Homeowners Association; Western States Council Sheet Metal, Air, Rail and Transportation; Westside Regional Alliance of Councils; Westwood Highlands Homeowners Association; Westwood Hills Property Owners Association; Westwood Homeowners Association; Westwood South of Santa Monica Blvd. Homeowners Association; Wilshire Montana Neighborhood Coalition; Windsor Square Association; 19 Individuals |