BILL ANALYSIS                                                                                                                                                                                                    




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  AB 710                      HEARING:  7/6/11
          AUTHOR:  Skinner                      FISCAL:  No
          VERSION:  6/29/11                     TAX LEVY:  No
          CONSULTANT:  Detwiler                 

            INFILL DEVELOPMENT AND SUSTAINABLE COMMUNITY ACT OF 2011
          

              Limits local parking requirements for development in 
                            transit intensive areas.


                           Background and Existing Law  

          Cities and counties must adopt general plans with seven 
          specified elements, including a land use element that 
          contains standards for population density and building 
          intensity.  Most local land use decisions must be 
          consistent with these general plans.  All cities and 
          counties' decisions on subdivisions and public works 
          projects must be consistent with their general plans.  
          General law cities and counties' zoning ordinances and 
          conditional use permits must be consistent with their 
          general plans.  However, except for the City of Los 
          Angeles's zoning ordinance (AB 283, V. Thomas, 1978), 
          charter cities' zoning ordinances and conditional use 
          permits don't have to be consistent with their general 
          plans.

          When local officials approve development projects, they can 
          require the applicants to dedicate land or pay in-lieu fees 
          to offset the projects' effects.  The exactions or impact 
          fees must be reasonably related to the need for public 
          facilities and the type of the development project.  In 
          other words, there must be a nexus between the development 
          and the conditions that local officials impose.

          The Planning and Zoning Law declares three state planning 
          priorities:
                 Promote infill development.
                 Protect environmental and agricultural resources.
                 Encourage efficient development patterns.
          That third priority supports new development that uses land 
          efficiently, is adjacent to developed areas, is planned for 




          AB 710 -- 6/29/11 -- Page 2



          new growth, is served by adequate transportation, and 
          minimizes taxpayers' continuing costs (AB 857, Wiggins, 
          2002).

          California has a goal of reducing greenhouse gas emissions 
          (AB 32, Nuez & Pavley, 2006).  Reducing vehicle emissions 
          involves multiple strategies, including clean technology as 
          well as reducing the amount of vehicle miles traveled.  
          Among the ways to reduce vehicle miles is better 
          coordination of transportation and land use plans and 
          increasing the density in existing areas and new 
          development projects.  To those ends, the Legislature 
          linked transportation planning and land use planning by 
          state, regional, and local agencies.  Metropolitan planning 
          organizations and their constituent cities and counties are 
          preparing sustainable communities strategies (SB 375, 
          Steinberg, 2008).

          Relying on real estate studies, infill builders argue that 
          when cities and counties impose their standard parking 
          requirements on development projects located near transit 
          routes and stops, the results include higher developer 
          costs and lower densities.  Some case studies show that 
          reducing parking standards can increase land values and 
          property tax revenues.


                                   Proposed Law  

          Assembly Bill 710 enacts the "Infill Development and 
          Sustainable Community Act of 2011," and contains 
          legislative declarations in support of its provisions.

          For new development projects in transit intensive areas, AB 
          710 prohibits cities and counties from requiring a minimum 
          parking standard greater than:
                 One space per 1,000 square feet of nonresidential 
               improvements, and
                 One space per residential unit.

          The bill allows cities and counties to require higher 
          minimum parking standards if they find that existing 
          publicly available parking within a  mile has a peak 
          occupancy exceeding 85%.  These findings require a parking 
          utilization study completed within the last 24 months that 
          reviews publicly owned on-street and off-street parking and 





          AB 710 -- 6/29/11 -- Page 3



          privately owned off-street parking that's publicly 
          accessible, excluding spaces on exclusively residential 
          streets.

          The bill's prohibition does not apply if the proposed 
          project:
                 And adjoining properties are restricted to 
               development at a floor area ratio below 0.75;
                 Is located on a parcel with dwelling units with 
               rents that are restricted by recorded covenants or 
               ordinances to levels affordable to low or moderate 
               income persons and families where the units will be 
               destroyed or removed.  However, this exception does 
               not apply if the proposed development includes an 
               equal number of units that will be affordable in the 
               same proportions as the former units.  In that case, 
               rental units must remain affordable for at least 55 
               years or the term remaining on recorded affordable 
               housing covenants.  Ownership units must be subject to 
               the same equity sharing agreement as currently applies 
               to ownership units in density bonus development 
               projects;  or  
                 Is located on a parcel where the owner withdrew 
               rental units from rental or lease pursuant to the 
               Ellis Act.

          AB 710 defines a "transit intensive area" as an area that 
          is within a  mile of:
                 An existing major transit stop, as defined by the 
               California Environmental Quality Act.
                 A planned major transit stop, as shown on a 
               regional transportation plan.
                 A high-quality transit corridor.

          The bill declares that a project is within this -mile 
          standard if:
                 All of the parcels have not more than 25% of their 
               area more than a -mile of the transit stop or transit 
               corridor;  and  
                 Not more than 10% of the residential units or 100 
               units (whichever is less) are more than  miles from 
               the transit stop or corridor.

          AB 710 defines a "high-quality transit corridor" as a 
          corridor with fixed route bus service with service 
          intervals less than 15 minutes during peak commute hours.





          AB 710 -- 6/29/11 -- Page 4





                               State Revenue Impact
           
          No estimate.


                                    Comments  

          1.   Purpose of the bill  .  Less is more.  By reducing their 
          standard parking requirements, public officials can promote 
          housing affordability and encourage residential densities, 
          especially near transit hubs and corridors.  Working from 
          real estate case studies, infill builders say that 
          requiring less space for parking boosts residential 
          densities while lowering their development costs.  Lower 
          costs can translate into higher profits and less expensive 
          housing.  While some cities and counties are starting to 
          accept this argument, many local officials still rely on 
          parking standards with origins that date back decades.  In 
          light of the significant federal, state, and local 
          investments in building and operating high-quality transit 
          services, the Legislature needs to step in and lower the 
          regulatory barriers to denser development.  AB 710 leaves 
          local standard parking requirements in place everywhere 
          except in transit intensive areas.  It's time to get a 
          private land use return on the public's transit 
          investments.

          2.   Community control, not state intrusion  .  With rare 
          exceptions, California leaves land use decisions up to 
          locally elected city councils and county boards of 
          supervisors.  Who knows local circumstances better than the 
          local officials picked by their constituents to promote 
          community values?  The state preempts local discretion over 
          land use only in limited situations.  Cities and counties 
          have lost their land use permit powers in four regions to 
          protect natural resources that have statewide importance: 
          the San Francisco Bay Conservation Development Commission, 
          the Tahoe Regional Planning Agency, the California Coastal 
          Commission, and the Delta Protection Commission.  The 
          Legislature has limited (or even preempted) local land use 
          regulations for specific uses: manufactured housing in 
          residential zones (AB 3735, Bornstein, 1994), second units 
          in residential zones (AB 1866, Wright, 2002), amateur radio 
          station antenna structures (AB 1228, Dutton, 2003), solar 





          AB 710 -- 6/29/11 -- Page 5



          energy systems (AB 2473, Wolk, 2004), wireless 
          telecommunications collocation facilities (SB 1627, Kehoe, 
          2006), small wind energy systems (AB 45, Blakeslee, 2009).  
          State law also regulates certain land uses' proximity to 
          specific sites: development on active earthquake faults (SB 
          5, Alquist, 1975), tobacco ads on billboards near schools 
          (AB 752, Migden, 1997), and medical marijuana sales near 
          schools (AB 2650, Buchanan, 2010).  But mundane local 
          parking standards hardly rise to those levels.  Sacramento 
          should stay out of local communities' need to control their 
          quality of life.

          3.   Gentrification worries  .  Nearly everyone recognizes 
          that lower parking standards help builders.  That's why the 
          density bonus law allows a developer demand lower parking 
          standards when building more housing, including affordable 
          units, than usually allowed (SB 1818, Hollingsworth, 2004). 
           Affordable housing advocates point out the quid pro quo 
          nature of the density bonus law; to get lower parking 
          standards, the builder must produce affordable housing as 
          part of the increased density.  In contrast, AB 710 insists 
          on lower parking standards without the quid pro quo for 
          affordable housing.  As a result, affordable housing 
          advocates worry about gentrification; builders will tear 
          down affordable apartments near transit hubs and corridors, 
          so they can build more market-rate housing.  The bill 
          provides two specific protections against gentrification.  
          Lower parking standards don't apply: (a) if a builder tears 
          down rent-controlled housing, unless the builder provides 
          income-restricted replacement housing in the same 
          proportions, or (b) if the project involves rental units 
          covered by the Ellis Act.  Housing advocates want 
          additional detailed protections for very low and low income 
          households.  Conversely, some advocates for apartment 
          owners want to ease the bill's current restrictions.  The 
          Committee may wish to consider whether enacting intricate 
          conditions and formulas into AB 710 will dilute the bill's 
          policy goals, substituting legislative prescription for 
          local adaptation.

          4.   Hubs and spokes  .  In communities without major transit 
          stops or high-quality bus service, AB 710 won't have any 
          impact.  However, by limiting local parking standards 
          within a  mile of transit stops and corridors, the bill 
          affects large areas in metropolitan regions.  The 
          prohibitions in AB 710 affect about 500 acres around every 





          AB 710 -- 6/29/11 -- Page 6



          existing and planned major transit stop, plus mile-wide 
          swaths (a half-mile on each side of key bus lines).  When 
          combined, those areas of state preemption remove local 
          control over parking standards from communities that enjoy 
          better transit services.  Practically speaking, where do 
          these provisions apply in transit rich communities like 
          Berkeley, Concord, Los Angeles, Pasadena, Sacramento, and 
          San Diego?  The Committee may wish to consider narrowing 
          the definition of a transit corridor to a  mile on each 
          side of the bus line, for a total width of  mile.

          5.   Parks and parking  .  AB 710 has a historical parallel.  
          Almost 30 years ago, home builders complained that some 
          cities used excessive local standards when imposing 
          parkland dedications or in-lieu fees conditions on 
          residential subdivisions.  The Legislature responded by 
          capping Quimby Act park dedications at three acres for each 
          1,000 new residents.  However, if local officials can show 
          that the amount of parkland in surrounding areas exceeds 
          that standard, they can use a higher standard, but not more 
          than five acres for each 1,000 new residents (AB 1785, 
          Foran, 1982).  Although city councils opposed the 1982 
          Foran bill as an intrusion into their home rule 
          prerogatives, they adapted quickly to the new state 
          standards.  Three decades later, hardly anyone remembers 
          the controversy.  Similarly, local officials will come to 
          accept AB 710's standards as the "new normal."

          6.   Conforming amendments  ?  AB 710's provisions for 
          affordable housing are similar, but not identical, to the 
          requirements that apply to redevelopment agencies.  If a 
          builder tears down affordable housing, AB 710 requires the 
          construction of an equal number of  units  .  Redevelopment 
          law requires the construction of an equal number of 
           bedrooms  (Health & Safety Code 33413 f]).  AB 710 
          requires the replacement units to remain affordable to 
          renters for at least 55 years and requires an equity 
          sharing agreement for the ownership replacement units.  
          Redevelopment law requires rental replacement units to 
          remain affordable for at least 55 years and ownership 
          replacement units to remain affordable for at least 45 
          years (Health & Safety Code 33334.2 f]1]A] & B]).  The 
          Committee may wish to consider amendments that conform AB 
          710's affordable housing requirements to the existing 
          requirements in redevelopment law.






          AB 710 -- 6/29/11 -- Page 7




                                 Assembly Actions 

          Assembly Housing & Community Development Committee:  7-0
          Assembly Local Government Committee:  8-0
          Assembly Appropriations Committee:      17-0
          Assembly Floor:                              76-0


                         Support and Opposition  (6/30/11)

           Support :  California Infill Builders Association; Alameda 
          Transportation Commission; AMCAL Multi-Housing Inc.; 
          American Institute of Architects, California Council; A.G. 
          Spanos Companies; Brookfield Homes;  California Apartment 
          Association; California Building Industry Association; 
          California Housing Consortium; California League of 
          Conservation Voters; California ReLeaf; Cities of El Monte, 
          Pittsburgh, San Bernardino; Civic Enterprise Development, 
          LLC; CIM Group, Inc.; Codding Enterprises; Community 
          Dynamics; Creative Housing Associates; David Taylor 
          Interest; Domus Development; Fulcrum Properties; Greenbelt 
          Alliance; JMA Ventures, LLC; Local Government Commission; 
          Metropolitan Transportation Commission; Mogavero Notestine 
          Associates; Natural Resources Defense Council; Newport 
          Partners, LLC; Non-Profit Housing Assoc. of Northern 
          California; Policy in Motion; Related Companies; San 
          Francisco Bay Area Rapid Transit District; San Francisco 
          Planning and Urban Research Association; TMG Partners; 
          Township Nine; TRANSFORM; United States Green Building 
          Council.

           Opposition  :  Association of California Cities-Orange 
          County; BOCA; Bus Riders Union; California Affordable 
          Housing Law Project; California Rural Legal Assistance 
          Foundation; Cities of Concord, Encinitas, Lafayette, 
          Lakewood, Moreno Valley; Coalition for Economic Survival; 
          Contra Costa County; Contra Costa Transportation Authority; 
          Green LA Coalition; Hollywood Community Housing 
          Corporation; Housing California; Housing Long Beach; Korean 
          Youth & Community Center; International Union of Painters 
          and Allied Trades, District Council 36; Kennedy Commission; 
          LA Voice PICO; LAANE; League of California Cities; 
          Neighborhood Based CDC Coalition; People Organized for 
          Westside Renewal; Public Advocates; Public Counsel Law 
          Center; Search to Involve Pilipino Americans; Strategic 





          AB 710 -- 6/29/11 -- Page 8



          Actions for a Just Economy; Southern California Association 
          of Nonprofit Housing; T.R.U.S.T. South LA; Venice Community 
          Housing Corporation; Watts/Century Latino Organization.