BILL ANALYSIS AB 2508 Page 1 ASSEMBLY THIRD READING AB 2508 (Caballero) As Amended May 3, 2010 Majority vote HOUSING 9-0 LOCAL GOVERNMENT 9-0 ----------------------------------------------------------------- |Ayes:|Torres, Arambula, |Ayes:|Smyth, Torlakson, | | |Bradford, Eng, Gilmore, | |Arambula, Bradford, | | |Knight, Saldana, | |Davis, Knight, Logue, | | |Torlakson, Tran | |Solorio, Fong | ----------------------------------------------------------------- SUMMARY : Allows a local agency to petition the Department of Housing and Community Development (HCD) for an exception to its jurisdictional classification for purposes of the Infill Infrastructure Grant Program (IIG) if the agency believes that it is unable to meet the related minimum housing density requirements. Specifically, this bill : 1)Allows a local agency to submit a petition with its IIG application. 2)Requires the petition to include the reasons why the agency believes the exception is warranted. 3)Requires the agency to provide other information supporting the need for the exception, including, but not limited to, any limitations that the local agency may encounter in meeting the related density requirements. EXISTING LAW : 1)Establishes IIG, administered by HCD, to provide grants to fund capital improvement projects that are an integral part of, or necessary to facilitate the development of, residential or mixed-use infill development. 2)Requires projects funded under IIG to have average residential densities of at least 30 units per acre in jurisdictions in metropolitan counties, 20 units per acres in suburban jurisdictions, 15 units per acre in incorporated cities within nonmetropolitan counties and in nonmetropolitan counties that AB 2508 Page 2 have micropolitan areas, and 10 units per acres in rural areas. FISCAL EFFECT : None COMMENTS : The IIG program was established in 2007 with funding from Proposition 1C, the Housing and Emergency Shelter Act of 2006. The program provides grants to fund infrastructure investments that support residential and mixed-use infill development projects. The program received just over $730 million from Proposition 1C; all of these funds have been awarded. The two IIG funding rounds were extremely competitive, with requests for funding outstripping available resources by approximately four to one. It is unclear when or if additional funds will be made available for the infill program. Under IIG, projects must meet certain average residential densities in order to be eligible for funding. These densities range from 10 to 30 units per acre depending on the way a jurisdiction is classified. A jurisdiction's classification is based on definitions established under Housing Element Law. For the purposes of Housing Element Law and thus for the purposes of IIG, the City of Salinas, with a population just under 150,000, is classified as a metropolitan jurisdiction. As such, an infill project in Salinas would have to be built at 30 units per acre or more in order to be eligible under the infill program. The author and sponsor argue that Salinas lacks the overall infrastructure to develop at a density above 30 units per acre, and that Salinas should not be designated as a metropolitan jurisdiction for the purposes of IIG because it is not a central city or an urban core. Salinas was unable to compete in the first two funding rounds under IIG because it did not have any projects that met the density requirements. The city would like the opportunity to petition HCD in any future IIG funding rounds for a different jurisdictional classification that would allow it to submit projects for consideration that are at a lower density than 30 units per acre. AB 2508 allows a jurisdiction to submit a petition for a change in classification along with an application under IIG. The petition must explain what the limitations are for the jurisdiction in meeting the minimum density required by its current classification. AB 2508 Page 3 Analysis Prepared by : Anya Lawler / H. & C.D. / (916) 319-2085 FN: 0004294