Housing

California 2018 Legislative Update

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Streamlining

AB 2162 – Supportive Housing by Right

  • Streamlined ministerial approval for projects that include supportive housing

  • CEQA not required for supportive housing projects that comply with local requirements, are 100% lower income and 25% of units are supportive.

AB 3194 – Housing Accountability Act

  • Limits local government determination of project inconsistency with zoning ordinance if the zoning doesn’t allow the maximum residential use, density or intensity in general plan.

  • Requires finding of a significant, quantifiable, direct, and unavoidable impact to disapprove or condition approval of projects if compliance with applicable, objective general plan, zoning, and subdivision standards and criteria.

SB 765 – SB 35 Clean Up

  • 100% affordable projects are exempt from the “skilled and trained workforce” labor requirement.

  • Only objective standards may be applied, including those related to subdivisions.

  • All local agency approvals for project are exempt from CEQA.

Density Bonus

AB 2753– Density Bonus Application

  • Jurisdictions must notify density bonus applicants in writing w/in 30 calendar days of application of completeness.

  • Local government must notify applicant of re-submitted density.

  • Bonus application in writing w/in 10 business days of resubmittal.

  • Local government has 60 days from complete application to approve or disapprove a density bonus.

  • Application deemed completed and density bonus granted if deadlines not met.

SB 1227 - Density Bonus for Student Housing

  • Requires up 35% density bonus projects with at least 20% of the total rental beds for very low income students enrolled in higher education at accredited institutions.

 Density Bonus (continued)

AB 2372 - Floor Area Ratio Bonus for Affordable Housing

  • Allows local government to adopt ordinance to grant floor area ratio (FAR) bonus in lieu of a density bonus. Project requirements include:

  • Multifamily development of 5+ units.

  • Located in urban infill site within transit priority area or within ½ mile of major transit stop.

  • Zoned for 20 units per acre.

  • Either 11% of affordable units for Very Low Income or 20 of affordable units for Low Income.

AB 1771 & SB 828 – RHNA

  • Requires modifications of regional RHNA allocation methodologies

  • RHNA must account for overcrowded housing units and cost burdened households, units lost related to a state of emergency

  • Gives HCD oversight authority over RHNA allocations

Fair Housing

AB 686– Housing Discrimination

  • Codifies recent HUD rules on jurisdictions’ obligation to further fair housing.

  • Housing elements and other planning documents must analyze how zoning programs/development approvals address/ reverse historical segregation patterns caused by past zoning practices.

CEQA Exemptions

AB 1804 – Infill Exemption for Counties

  • CEQA exemption applicable to unincorporated areas of counties.

  • Developments have minimum density and location requirements (must be urbanized area.)

AB 2341– Limited Aesthetic Impact Exemption

  • CEQA exemption for rehabilitation or replacement of existing, vacant structure (within building envelope) with residential development.

Charter Cities

AB 1333 – Charter Cities

  • Government Code provisions now apply to Charter Cities.

  • Consistency requirement applicable to general plan, specific plans and zoning.

  • No Net Loss” requirements apply to housing element inventory sites.

  • Specific findings required for growth control measures.

 Maps and Permits

AB 2913– Extension of building permits

  • Extends residential building permits from six months to one year.

  • One or more extensions of 180 days can be granted if justifiable cause

AB 2973– Subdivision map extensions (Central Valley)

  • 2 years for tentative subdivision maps in certain Central Valley jurisdictions 1771

Can Public Agency Land Use Help Save Us from the State Housing Crisis?

Along with being well known for its near perfect weather and plethora of offerings for tourists, California has now also become known for facing one of the worst housing crises in the nation.  A study done in 2016 by the McKinsey Global Institute found that California was ranked 49th out of all 50 states in housing units per capita and losing close to $140 billion per year due to the shortage of housing.  Based on California’s HCD Annual Progress Report data compiled in early 2018, more than 97% of the state’s jurisdictions are failing to meet the goals for developing affordable housing.  This harsh reality has left the state to ponder what resolutions could be utilized for tackling this dire dilemma.

Some recent proposed solutions to the housing crisis have come in the form of the 2017 Legislative Housing package signed into effect by Governor Jerry Brown in September of last year which includes 15 bills aimed at addressing the housing crisis.  However, with the housing crisis being as wide spread and serious as it is, it will likely require solutions in addition to recently passed legislature.  Circulate San Diego recently released a report examining the conversion of the underutilized Metropolitan Transit System parking lots into affordable housing as a solution to the state’s housing crisis.  Their report identified that this plan would not only generate up to 8,000 new homes with 3,000 of those designated for low income use, but the plan also aligns with similar policies and practices already in use by fellow transit agencies like the LA County MTA, Bay Area Rapid Transit and Santa Clara Valley Transportation Authority.

The report from Circulate San Diego begs the question: Could an answer to the state housing crisis lie in the use of other under used public agency land too?  In addition to transit systems, other public agency properties including school districts, utility districts and water districts, may provide some respite in the struggle to reign in the housing crisis.  This possible solution does not come without it’s fair share of challenges which may include the need to enhance or remove the existing infrastructure, zoning restrictions and community engagement of the surrounding area which for low income and affordable housing specific development may give way to objections from those with the “not in my backyard” perspective.  Despite the possible challenges that may lie ahead with the use of public agency land for housing development, state officials may find this a solution worth considering in the struggle to resolve the state housing crisis.

Thinking Ahead: Housing Successor Needs

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California has an increasing need for affordable housing but not enough public dollars to fund that need.  In response to a growing affordability crisis, the State Legislature is paying closer attention to existing funding sources and housing assets.  This means housing successors are under increased scrutiny to maximize their assets on a local level.  Even agencies caught up with local reporting need to think ahead to leverage assets and remain in compliance. 

Are you sure your housing successor complies with the law?  Are there outstanding items you need to address?  RSG will be sending each of our housing successor clients a Housing Diagnostic that evaluates your agency’s needs and identifies steps to maximize assets, assist low income households, and ensure future compliance.  Meeting income and age targets, taking action to dispose of or develop properties, spending funds to avoid an excess surplus, and SB 35 streamlining are a sample of the topics covered.  Producing results is more important than ever as HCD and State legislators take a closer look at existing housing funds.  If RSG does not consult your housing successor but you are interested in a diagnostic, contact Suzy Kim, Senior Associate, at skim@webrsg.com or (714) 316-2116.

New Consequences for Housing Element Annual Reports

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The 2017 Legislative Housing Package passed 15 bills that enact new housing regulations in California.  Assembly Bill (AB) 879 and Senate Bill (SB) 35 placed increased importance on Housing Element Annual Progress Reports (Annual Reports) that are due to HCD by April 1 each year.  New consequences for failing to complete Annual Reports include court sanctions and losing local control over affordable multifamily housing development entitlements to a new streamlined approval process.   If your jurisdiction is behind on its Annual Reports, it could lose local control over affordable multifamily housing development entitlements as early as this year.

Charter Cities Must Complete Report

·         Charter cities used to be exempt from submitting an Annual Report.  They must now submit an Annual Report beginning with the 2017 report due April 1, 2018. 

Failure to Submit Annual Reports

·         Failure to submit an Annual Report within 60 days of the due date could result in court orders to compel compliance, and court sanctions if not completed as ordered.

·         Failure to submit the Annual Report for two or more consecutive years triggers SB 35 provisions streamlining affordable multifamily housing development approvals, losing significant local control over the entitlement process. 

New Annual Reporting Requirements

Local jurisdictions need to track new housing production data in 2018 to include in the Annual Report due April 2019, and ongoing years.  This includes data on:

·         Housing Development Applications and Approvals

·         Housing Production in progress (via entitlement, building permit, or certificate of occupancy)

·         Sites Identified or Rezoned to Accommodate RHNA Need (related to “No Net Loss” provisions passed by AB 166)

HCD will use new Annual Report data to determine if a locality has not issued enough building permits to satisfy its RHNA allocation by income category for a reporting period, subjecting it to SB 35 streamlining provisions until the next reporting period. 

Annual Reports due by April 1 must continue to include the Housing Successor Annual Report for redevelopment housing successors that are not Housing Authorities (Housing Authority reports are due by October 1 and December 31).

Contact Suzy Kim, Senior Associate, at skim@webrsg.com or 714.316.2116, if you have questions or need assistance preparing your Annual Report to retain local control over housing development and avoid court sanctions.

Written by Suzy Kim, a Senior Associate at RSG

CALIFORNIA LEGISLATURE PASSES BILLS DESIGNED TO COMBAT AFFORDABLE HOUSING CRISIS

More than a dozen bills designed to help communities in California combat an affordable housing crisis were approved by the California Legislature on Friday, September 15, 2017 and sent to the Governor for his approval.  This past year marks the Legislature’s “Year of Housing,” wherein more than one hundred housing proposals were introduced and debated in order to provide for assistance in funding for affordable housing development, streamlining local government approval of housing projects, restoring authority to impose inclusionary housing requirements on private housing developers, and creating more state-wide Anti-NIMBY laws.  Governor Brown is expected to sign at least three major bills in the package:  SB 2, SB 3 and SB 35.

SB 2, by Sen. Toni Atkins, D-San Diego, would provide for a “permanent source” of funds for affordable housing development through the creation of a $75 fee on most recorded documents (except for home sales).  This fee is expected to generate $200-300 million per year that can be used for affordable housing development.  Half of the funds generated in 2018 would be made available to local governments for updating planning documents and zoning ordinances in order to streamline housing production, and the other half would go to the state for homeless assistance programs.  Beginning in 2019, 70% of the funds would be directly allocated to local governments for a variety of affordable housing programs, and the other 30% would be used by the state for mixed income multifamily housing, farmworker housing and other programs.

SB 3, by Sen. Jim Beall, D-Campbell, would place a $4 billion statewide housing bond on the November 2018 state ballot, with bond proceeds to be used to fund a number of existing housing programs:  $1.5 billion of the funds would go to the state’s Multifamily Housing Program for affordable housing development loans, $1 billion of the funds would go to the state’s CalVet veteran’s home loan program, with the remainder of the funds allocated for the CalHome down payment, farmworker housing, transit-oriented development, mortgage assistance programs and infrastructure supporting infill housing. 

SB 35, by Sen. Scott Wiener, D-San Francisco, creates a streamlined approval process for housing developments in communities that have not approved enough housing to keep up with regional fair share housing goals.  Eligible projects do not need to obtain conditional use permits and can take advantage of lower state-mandated parking standards.  To take advantage of this process, the proposed development must be on an urban infill site, the development must not be in the coastal zone, agricultural land or other sensitive areas.  Furthermore, the developer taking advantage of this streamlined process (an optional right for the developer) must pay prevailing wages and, in some cases, certify that it will use a “skilled and trained workforce” to complete the project.  Critics of SB 35 believe that it will impose extraordinary costs on affordable housing construction, thus hindering the legislature’s ultimate goal.

Governor Jerry Brown has until October 15, 2017 to sign or veto these bills.  Do you think these bills will adequately fix housing issues in your local community?  What are your local communities doing to address these issues, and how do these actions align or conflict with these proposed bills?  We would love to hear your thoughts.  Please share them with tmatthews@webrsg.com.

This blog was Co-Authored by Millay Kogan, RSG Analyst and Tara Matthews, RSG Partner

Proposed Affordable Housing Bills

The affordable housing crisis in California is a well-known fact and over 130 bills have been proposed by State lawmakers to address and hopefully improve one of the State’s most urgent needs.  The link below to a recent Los Angeles Times article provides a brief and basic summary of all proposed bills:
http://www.latimes.com/politics/la-pol-sac-housing-bills-taxes-affordable-20170319-story.html
 

CEQA Litigation: Harmful for Housing?

Litigation abuse under the California Environmental Quality Act (CEQA) undermines Californiaʹs environmental, social equity, and economic priorities, according to a Holland & Knight report, the first comprehensive study of lawsuits filed under CEQA. Analyzing all CEQA lawsuits filed from 2010 to 2012, the report systematically documents widespread abuse of CEQA litigation.

 

The study says that 49% of all CEQA lawsuits targeted taxpayer-funded projects with no business or other private sector sponsors. Projects designed to advance California’s environmental policy objectives – transit, renewable energy, and housing -- are the most frequent targets of CEQA lawsuits. Infill projects are the overwhelming target of CEQA lawsuits. CEQA litigation is overwhelmingly used in cities, targeting core urban services such as parks, schools, libraries, and even senior housing. 64% of those filing CEQA lawsuits are individuals or local “associations,” primarily the domain of Not In My Backyard (NIMBY) opponents and special interests.

According to the report, ending CEQA litigation abuse is the most cost-effective way to restore the state's middle-class job base, make housing more affordable, ensure that taxpayer funds are spent on projects, and improve the future of the nearly nine million Californians living in poverty. The authors recommend three moderate reforms to curtail the abuse:

  1. Require those filing CEQA lawsuits to disclose their identity and interests.

  2. Eliminate duplicative lawsuits aimed at derailing plans and projects that have already completed the CEQA process.

  3. Preserve CEQA’s existing environmental review and public comment requirements, as well as access to litigation remedies for environmental purposes, but restrict judicial invalidation to projects that would harm public health, destroy irreplaceable tribal resources, or threaten the ecology.

Written by Dima Galkin, an Associate at RSG

A Deep Dive into Property Taxes

Joan Youngman, senior fellow and chair of the Lincoln Institute of Land Policy’s Department of Valuation and Taxation, recently wrote a book covering property taxes in depth. In A Good Tax: Legal and Policy Issues for the Property Tax in the United States, Youngman defends property taxes as a more powerful revenue source than the federal income tax (generating $472 million and $297 million, respectively, from 2005 to 2015) and a vital support for independent local government.

Youngman argues that property taxes should be stable, efficient, fair, and transparent to maintain their status as a “good” tax. Limits on property tax assessment, such as the limit created by Proposition 13, generate problematic consequences, like rewarding longtime property owners at the expense of recent purchasers.

Proposed changes for Proposition 13 are at least being discussed. One source with good ideas is the Better Institutions blog. Will the ideas of Youngman and Better Institutions find open ears in Sacramento?

RSG can help you to analyze the impact of new legislation. Contact us for more details.

Written by Dima Galkin, an Associate at RSG

 

Seeking Greater Housing Affordability

 Copyright American Planning Association Creative Commons License This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

Copyright American Planning Association
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

A recent Urban Land Institute Terwilliger Center for Housing article emphasizes the scope of the US housing shortage. According to the article, new residential construction is below its historic average and even Great Recession-era levels.

Currently, much new apartment development aims for the high end of the market to make the financials work for developers. Rising land and labor costs, local regulations and NIMBYism make it even more difficult and expensive to build new housing. 

Many cities are spending precious funds to subsidize rent-restricted units, proving that we as a society care about housing affordability. Maybe we should consider the maxim of “first, do no harm.” How can cities reduce barriers to encourage more housing development, both market-rate and rent-restricted? How can we get community stakeholders to recognize that some development and change is needed to accommodate new residents and maintain affordability for renters? 

We passionately discuss topics like this affecting cities and towns at the RSG office, in search of solutions. Contact us today if you’re looking for such solutions.

Written by Dima Galkin, an Associate at RSG

Proliferating Sober Living Homes

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With sober living homes sprouting up in nearly every Orange County city, the Association of California Cities, Orange County (ACC-OC) is focusing on legislative and regulatory solutions that empower cities and protect patients from "bad acting" facilities. While cities need to regulate sober living facilities according to state and federal disability laws, some cities – notably Costa Mesa, Laguna Niguel, Mission Viejo and San Juan Capistrano – are taking advantage of tools at their disposal to address key issues.

ACC-OC conducted research and prepared a resource guide for cities managing the rising number of these homes. As part of this effort, the ACC-OC has compiled a comprehensive summary of regulations currently in place in a number of cities across Orange County. The objective is to help cities to manage sober living homes and empower neighborhoods while protecting patients' and homeowners' property rights.

RSG shares ACC-OC’s concern about communities in Orange County and beyond. We encourage you to see what works in cities that have implemented plans.

Written by Hitta Mosesman, a Principal at RSG