California Legislature—2015–16 Regular Session

Assembly BillNo. 744


Introduced by Assembly Member Chau

February 25, 2015


An act to amend Section 65915 of the Government Code, relating to housing.

LEGISLATIVE COUNSEL’S DIGEST

AB 744, as introduced, Chau. Planning and zoning: density bonuses.

The Planning and Zoning Law requires, when a developer of housing proposes a housing development within the jurisdiction of the local government, that the city, county, or city and county provide the developer with a density bonus and other incentives or concessions for the production of lower income housing units or the donation of land within the development if the developer, among other things, agrees to construct a specified percentage of units for very low, low-, or moderate-income households or qualifying residents. Existing law requires continued affordability for 55 years or longer, as specified, of all very low and low-income units that qualified an applicant for a density bonus.

This bill would make technical, nonsubstantive changes to these provisions.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

P1    1

SECTION 1.  

Section 65915 of the Government Code is
2amended to read:

P2    1

65915.  

(a) When an applicant seeks a density bonus for a
2housing development within, or for the donation of land for housing
3within, the jurisdiction of a city, county, or city and county, that
4local government shall provide the applicant with incentives or
5concessions for the production of housing units and child care
6facilities as prescribed in this section. All cities, counties, or cities
7and counties shall adopt an ordinance that specifies how
8compliance with this section will be implemented. Failure to adopt
9an ordinance shall not relieve a city, county, or city and county
10from complying with this section.

11(b) (1) A city, county, or city and county shall grant one density
12bonus, the amount of which shall be as specified in subdivision
13(f), and incentives or concessions, as described in subdivision (d),
14when an applicant for a housing development seeks and agrees to
15construct a housing development, excluding any units permitted
16by the density bonus awarded pursuant to this section, that will
17contain at least any one of the following:

18(A) Ten percent of the total units of a housing development for
19lower income households, as defined in Section 50079.5 of the
20Health and Safety Code.

21(B) Five percent of the total units of a housing development for
22very low income households, as defined in Section 50105 of the
23Health and Safety Code.

24(C) A senior citizen housing development, as defined in Sections
2551.3 and 51.12 of the Civil Code, orbegin insert aend insert mobilehome park that limits
26residency based on age requirements for housing for older persons
27pursuant to Section 798.76 or 799.5 of the Civil Code.

28(D) Ten percent of the total dwelling units in a common interest
29begin delete developmentend deletebegin insert development,end insert as defined in Section 4100 of the Civil
30begin delete Codeend deletebegin insert Code,end insert for persons and families of moderate income, as
31defined in Section 50093 of the Health and Safety Code, provided
32that all units in the development are offered to the public for
33purchase.

34(2) For purposes of calculating the amount of the density bonus
35pursuant to subdivision (f),begin delete theend deletebegin insert anend insert applicant who requests a density
36bonus pursuant to this subdivision shall elect whether the bonus
37shall be awarded on the basis of subparagraph (A), (B), (C), or (D)
38of paragraph (1).

39(3) For the purposes of this section, “total units” or “total
40dwelling units” does not include units added by a density bonus
P3    1awarded pursuant to this section or any local law granting a greater
2density bonus.

3(c) (1) An applicant shall agree to, and the city, county, or city
4and county shall ensure,begin insert theend insert continued affordability of all very low
5and low-income rental units that qualified the applicant for the
6award of the density bonus for 55 years or a longer period of time
7if required by the construction or mortgage financing assistance
8program, mortgage insurance program, or rental subsidy program.
9Rents for the lower income density bonus units shall be set at an
10affordable rent as defined in Section 50053 of the Health and Safety
11Code.

12(2) An applicant shall agree to, and the city, county, or city and
13county shall ensure that, the initial occupant of all for-sale units
14that qualified the applicant for the award of the density bonus are
15persons and families of very low, low, or moderate income, as
16required, and that the units are offered at an affordable housing
17cost, as that cost is defined in Section 50052.5 of the Health and
18Safety Code. The local government shall enforce an equity sharing
19agreement, unless it is in conflict with the requirements of another
20public funding source or law. The following apply to the equity
21sharing agreement:

22(A) Upon resale, the seller of the unit shall retain the value of
23any improvements, the downpayment, and the seller’s proportionate
24share of appreciation. The local government shall recapture any
25initial subsidy, as defined in subparagraph (B), and its proportionate
26share of appreciation, as defined in subparagraph (C), which
27amount shall be used within five years for any of the purposes
28described in subdivision (e) of Section 33334.2 of the Health and
29Safety Code that promote home ownership.

30(B) For purposes of this subdivision, the local government’s
31initial subsidy shall be equal to the fair market value of the home
32at the time of initial sale minus the initial sale price to the
33moderate-income household, plus the amount of any downpayment
34assistance or mortgage assistance. If upon resale the market value
35is lower than the initial market value, then the value at the time of
36the resale shall be used as the initial market value.

37(C) For purposes of this subdivision, the local government’s
38proportionate share of appreciation shall be equal to the ratio of
39the local government’s initial subsidy to the fair market value of
40the home at the time of initial sale.

P4    1(3) (A) An applicant shall be ineligible for a density bonus or
2any other incentives or concessions under this section if the housing
3development is proposed on any property that includes a parcel or
4parcels on which rental dwelling units are or, if the dwelling units
5have been vacated or demolished in the five-year period preceding
6the application, have been subject to a recorded covenant,
7ordinance, or law that restricts rents to levels affordable to persons
8and families of lower or very low income; subject to any other
9form of rent or price control through a public entity’s valid exercise
10of its police power; or occupied by lower or very low income
11households, unless the proposed housing development replaces
12those units, and either of the following applies:

13(i) The proposed housing development, inclusive of the units
14replaced pursuant to this paragraph, contains affordable units at
15the percentages set forth in subdivision (b).

16(ii) Each unit in the development, exclusive of a manager’s unit
17or units, is affordable to, and occupied by, either a lower or very
18low income household.

19(B) For the purposes of this paragraph, “replace” shall mean
20either of the following:

21(i) If any dwelling units described in subparagraph (A) are
22occupied on the date of application, the proposed housing
23development shall provide at least the same number of units of
24equivalent size or type, or both, to be made available at affordable
25rent or affordable housing cost to, and occupied by, persons and
26families in the same or lower income category as those households
27in occupancy. For unoccupied dwelling units described in
28subparagraph (A) in a development with occupied units, the
29proposed housing development shall provide units of equivalent
30size or type, or both, to be made available at affordable rent or
31affordable housing cost to, and occupied by, persons and families
32in the same or lower income category in the same proportion of
33affordability as the occupied units. All replacement calculations
34resulting in fractional units shall be rounded up to the next whole
35number. If the replacement units will be rental dwelling units,
36these units shall be subject to a recorded affordability restriction
37for at least 55 years. If the proposed development is for-sale units,
38the units replaced shall be subject to paragraph (2).

39(ii) If all dwelling units described in subparagraph (A) have
40been vacated or demolished within the five-year period preceding
P5    1the application, the proposed housing development shall provide
2at least the same number of units of equivalent size or type, or
3both, as existed at the highpoint of those units in the five-year
4period preceding the application to be made available at affordable
5rent or affordable housing cost to, and occupied by, persons and
6families in the same or lower income category as those persons
7and families in occupancy at that time, if known. If the incomes
8of the persons and families in occupancy at the highpoint is not
9known, then one-half of the required units shall be made available
10at affordable rent or affordable housing cost to, and occupied by,
11very low income persons and families and one-half of the required
12units shall be made available for rent at affordable housing costs
13 to, and occupied by, low-income persons and families. All
14replacement calculations resulting in fractional units shall be
15rounded up to the next whole number. If the replacement units will
16be rental dwelling units, these units shall be subject to a recorded
17affordability restriction for at least 55 years. If the proposed
18development is for-sale units, the units replaced shall be subject
19to paragraph (2).

20(C) Paragraph (3) of subdivision (c) does not apply to an
21applicant seeking a density bonus for a proposed housing
22development ifbegin delete theirend deletebegin insert his or herend insert application was submitted to, or
23processed by, a city, county, or city and county before January 1,
242015.

25(d) (1) An applicant for a density bonus pursuant to subdivision
26(b) may submit to a city, county, or city and county a proposal for
27the specific incentives or concessions that the applicant requests
28pursuant to this section, and may request a meeting with the city,
29county, or city and county. The city, county, or city and county
30shall grant the concession or incentive requested by the applicant
31unless the city, county, or city and county makes a written finding,
32based upon substantial evidence, of any of the following:

33(A) The concession or incentive is not required in order to
34provide for affordable housing costs, as defined in Section 50052.5
35of the Health and Safety Code, or for rents for the targeted units
36to be set as specified in subdivision (c).

37(B) The concession or incentive would have a specific adverse
38impact, as defined in paragraph (2) of subdivision (d) of Section
3965589.5, upon public health and safety or the physical environment
40or on any real property that is listed in the California Register of
P6    1Historical Resources and for which there is no feasible method to
2satisfactorily mitigate or avoid the specific adverse impact without
3rendering the development unaffordable to low- and
4moderate-income households.

5(C) The concession or incentive would be contrary to state or
6federal law.

7(2) The applicant shall receive the following number of
8incentives or concessions:

9(A) One incentive or concession for projects that include at least
1010 percent of the total units for lower income households, at least
115 percent for very low income households, or at least 10 percent
12for persons and families of moderate income in a common interest
13development.

14(B) Two incentives or concessions for projects that include at
15least 20 percent of the total units for lower income households, at
16least 10 percent for very low income households, or at least 20
17percent for persons and families of moderate income in a common
18interest development.

19(C) Three incentives or concessions for projects that include at
20least 30 percent of the total units for lower income households, at
21least 15 percent for very low income households, or at least 30
22percent for persons and families of moderate income in a common
23interest development.

24(3) The applicant may initiate judicial proceedings if the city,
25county, or city and county refuses to grant a requested density
26bonus, incentive, or concession. If a court finds that the refusal to
27grant a requested density bonus, incentive, or concession is in
28violation of this section, the court shall award the plaintiff
29reasonable attorney’s fees and costs of suit. Nothing in this
30subdivision shall be interpreted to require a local government to
31grant an incentive or concession that has a specific, adverse impact,
32as defined in paragraph (2) of subdivision (d) of Section 65589.5,
33upon health, safety, or the physical environment, and for which
34there is no feasible method to satisfactorily mitigate or avoid the
35specific adverse impact. Nothing in this subdivision shall be
36interpreted to require a local government to grant an incentive or
37concession that would have an adverse impact on any real property
38that is listed in the California Register of Historical Resources.
39The city, county, or city and county shall establish procedures for
P7    1carrying out this section, that shall include legislative body
2approval of the means of compliance with this section.

3(e) (1) In no case may a city, county, or city and county apply
4any development standard that will have the effect of physically
5precluding the construction of a development meeting the criteria
6of subdivision (b) at the densities or with the concessions or
7incentives permitted by this section. An applicant may submit to
8a city, county, or city and county a proposal for the waiver or
9reduction of development standards that will have the effect of
10physically precluding the construction of a development meeting
11the criteria of subdivision (b) at the densities or with the
12concessions or incentives permitted under this section, and may
13request a meeting with the city, county, or city and county. If a
14court finds that the refusal to grant a waiver or reduction of
15development standards is in violation of this section, the court
16shall award the plaintiff reasonable attorney’s fees and costs of
17suit. Nothing in this subdivision shall be interpreted to require a
18local government to waive or reduce development standards if the
19waiver or reduction would have a specific, adverse impact, as
20defined in paragraph (2) of subdivision (d) of Section 65589.5,
21upon health, safety, or the physical environment, and for which
22there is no feasible method to satisfactorily mitigate or avoid the
23specific adverse impact. Nothing in this subdivision shall be
24interpreted to require a local government to waive or reduce
25development standards that would have an adverse impact on any
26real property that is listed in the California Register of Historical
27Resources, or to grant any waiver or reduction that would be
28contrary to state or federal law.

29(2) A proposal for the waiver or reduction of development
30standards pursuant to this subdivision shall neither reduce nor
31increase the number of incentives or concessions to which the
32applicant is entitled pursuant to subdivision (d).

33(f) For the purposes of this chapter, “density bonus” means a
34density increase over the otherwise maximum allowable residential
35density as of the date of application by the applicant to the city,
36county, or city and county. The applicant may elect to accept a
37lesser percentage of density bonus. The amount of density bonus
38to which the applicant is entitled shall vary according to the amount
39by which the percentage of affordable housing units exceeds the
40percentage established in subdivision (b).

P8    1(1) For housing developments meeting the criteria of
2subparagraph (A) of paragraph (1) of subdivision (b), the density
3bonus shall be calculated as follows:


4

 

Percentage Low-Income UnitsPercentage Density Bonus
1020 
1121.5
1223 
1324.5
1426 
1527.5
1730.5
1832 
1933.5
2035 
P8   1721P8   3037P8   303P8   26

 

18(2) For housing developments meeting the criteria of
19subparagraph (B) of paragraph (1) of subdivision (b), the density
20bonus shall be calculated as follows:

 

Percentage Very Low Income UnitsPercentage Density Bonus
520 
622.5
725 
827.5
930 
1032.5
1135 
P8   3037P8   303P8   26

 

31(3) For housing developments meeting the criteria of
32subparagraph (C) of paragraph (1) of subdivision (b), the density
33bonus shall be 20 percent of the number of senior housing units.

34(4) For housing developments meeting the criteria of
35subparagraph (D) of paragraph (1) of subdivision (b), the density
36bonus shall be calculated as follows:

 

Percentage Moderate-Income UnitsPercentage Density Bonus
105
116
127
138
149
1510
1611
1712
1813
1914
2015
2116
2217
2318
2419
2520
2621
2722
2823
2924
3025
3126
3227
3328
3429
3530
3631
3732
3833
3934
4035
P8   303P8   26

 

31(5) All density calculations resulting in fractional units shall be
32rounded up to the next whole number. The granting of a density
33bonus shall not be interpreted, in and of itself, to require a general
34plan amendment, local coastal plan amendment, zoning change,
35or other discretionary approval.

36(g) (1) When an applicant for a tentative subdivision map,
37parcel map, or other residential development approval donates
38land to a city, county, or city and county in accordance with this
39subdivision, the applicant shall be entitled to a 15-percent increase
P10   1above the otherwise maximum allowable residential density for
2the entire development, as follows:

 

Percentage Very Low IncomePercentage Density Bonus
1015
1116
1217
1318
1419
1520
1621
1722
1823
1924
2025
2126
2227
2328
2429
2530
2631
2732
2833
2934
3035
P8   26

 

27(2) This increase shall be in addition to any increase in density
28mandated by subdivision (b), up to a maximum combined mandated
29density increase of 35 percent if an applicant seeks an increase
30pursuant to both this subdivision and subdivision (b). All density
31calculations resulting in fractional units shall be rounded up to the
32next whole number. Nothing in this subdivision shall be construed
33to enlarge or diminish the authority of a city, county, or city and
34county to require a developer to donate land as a condition of
35development. An applicant shall be eligible for the increased
36density bonus described in this subdivision if all of the following
37conditions are met:

38(A) The applicant donates and transfers the land no later than
39the date of approval of the final subdivision map, parcel map, or
40residential development application.

P11   1(B) The developable acreage and zoning classification of the
2land being transferred are sufficient to permit construction of units
3affordable to very low income households in an amount not less
4than 10 percent of the number of residential units of the proposed
5development.

6(C) The transferred land is at least one acre in size or of
7sufficient size to permit development of at least 40 units, has the
8appropriate general plan designation, is appropriately zoned with
9appropriate development standards for development at the density
10described in paragraph (3) of subdivision (c) of Section 65583.2,
11and is or will be served by adequate public facilities and
12infrastructure.

13(D) The transferred land shall have all of the permits and
14approvals, other than building permits, necessary for the
15development of the very low income housing units on the
16transferred land, not later than the date of approval of the final
17subdivision map, parcel map, or residential development
18application, except that the local government may subject the
19proposed development to subsequent design review to the extent
20authorized by subdivision (i) of Section 65583.2 if the design is
21not reviewed by the local government prior to the time of transfer.

22(E) The transferred land and the affordable units shall be subject
23to a deed restriction ensuring continued affordability of the units
24consistent with paragraphs (1) and (2) of subdivision (c), which
25shall be recorded on the property at the time of the transfer.

26(F) The land is transferred to the local agency or to a housing
27developer approved by the local agency. The local agency may
28require the applicant to identify and transfer the land to the
29developer.

30(G) The transferred land shall be within the boundary of the
31proposed development or, if the local agency agrees, within
32one-quarter mile of the boundary of the proposed development.

33(H) A proposed source of funding for the very low income units
34shall be identified not later than the date of approval of the final
35subdivision map, parcel map, or residential development
36application.

37(h) (1) When an applicant proposes to construct a housing
38development that conforms to the requirements of subdivision (b)
39and includes a child care facility that will be located on the
P12   1premises of, as part of, or adjacent to, the project, the city, county,
2or city and county shall grant either of the following:

3(A) An additional density bonus that is an amount of square
4feet of residential space that is equal to or greater than the amount
5of square feet in the child care facility.

6(B) An additional concession or incentive that contributes
7significantly to the economic feasibility of the construction of the
8child care facility.

9(2) The city, county, or city and county shall require, as a
10condition of approving the housing development, that the following
11occur:

12(A) The child care facility shall remain in operation for a period
13of time that is as long as or longer than the period of time during
14which the density bonus units are required to remain affordable
15pursuant to subdivision (c).

16(B) Of the children who attend the child care facility, the
17children of very low income households, lower income households,
18or families of moderate income shall equal a percentage that is
19equal to or greater than the percentage of dwelling units that are
20required for very low income households, lower income
21households, or families of moderate income pursuant to subdivision
22(b).

23(3) Notwithstanding any requirement of this subdivision, a city,
24county, or city and county shall not be required to provide a density
25bonus or concession for a child care facility if it finds, based upon
26substantial evidence, that the community has adequate child care
27facilities.

28(4) “Child care facility,” as used in this section, means a child
29day care facility other than a family day care home, including, but
30not limited to, infant centers, preschools, extended day care
31facilities, and schoolage child care centers.

32(i) “Housing development,” as used in this section, means a
33development project for five or more residential units. For the
34purposes of this section, “housing development” also includes a
35subdivision or common interest development, as defined in Section
364100 of the Civil Code, approved by a city, county, or city and
37county and consists of residential units or unimproved residential
38lots and either a project to substantially rehabilitate and convert
39an existing commercial building to residential use or the substantial
40rehabilitation of an existing multifamily dwelling, as defined in
P13   1subdivision (d) of Section 65863.4, where the result of the
2rehabilitation would be a net increase in available residential units.
3For the purpose of calculating a density bonus, the residential units
4shall be on contiguous sites that are the subject of one development
5application, but do not have to be based upon individual
6subdivision maps or parcels. The density bonus shall be permitted
7in geographic areas of the housing development other than the
8areas where the units for the lower income households are located.

9(j) (1) The granting of a concession or incentive shall not be
10interpreted, in and of itself, to require a general plan amendment,
11local coastal plan amendment, zoning change, or other discretionary
12approval. This provision is declaratory of existing law.

13(2) Except as provided in subdivisions (d) and (e), the granting
14of a density bonus shall not be interpreted to require the waiver of
15a local ordinance or provisions of a local ordinance unrelated to
16development standards.

17(k) For the purposes of this chapter, concession or incentive
18means any of the following:

19(1) A reduction in site development standards or a modification
20of zoning code requirements or architectural design requirements
21that exceed the minimum building standards approved by the
22California Building Standards Commission as provided in Part 2.5
23(commencing with Section 18901) of Division 13 of the Health
24and Safety Code, including, but not limited to, a reduction in
25setback and square footage requirements and in the ratio of
26vehicular parking spaces that would otherwise be required that
27results in identifiable, financially sufficient, and actual cost
28reductions.

29(2) Approval of mixed-use zoning in conjunction with the
30housing project if commercial, office, industrial, or other land uses
31will reduce the cost of the housing development and if the
32commercial, office, industrial, or other land uses are compatible
33with the housing project and the existing or planned development
34in the area where the proposed housing project will be located.

35(3) Other regulatory incentives or concessions proposed by the
36developer or the city, county, or city and county that result in
37identifiable, financially sufficient, and actual cost reductions.

38(l) Subdivision (k) does not limit or require the provision of
39direct financial incentives for the housing development, including
P14   1the provision of publicly owned land, by the city, county, or city
2and county, or the waiver of fees or dedication requirements.

3(m) This section shall not be construed to supersede or in any
4way alter or lessen the effect or application of the California
5Coastal Act of 1976 (Division 20 (commencing with Section
630000) of the Public Resources Code).

7(n) If permitted by local ordinance, nothing in this section shall
8be construed to prohibit a city, county, or city and county from
9granting a density bonus greater than what is described in this
10 section for a development that meets the requirements of this
11section or from granting a proportionately lower density bonus
12than what is required by this section for developments that do not
13meet the requirements of this section.

14(o) For purposes of this section, the following definitions shall
15apply:

16(1) “Development standard” includes a site or construction
17condition, including, but not limited to, a height limitation, a
18setback requirement, a floor area ratio, an onsite open-space
19requirement, or a parking ratio that applies to a residential
20development pursuant to any ordinance, general plan element,
21specific plan, charter, or other local condition, law, policy,
22resolution, or regulation.

23(2) “Maximum allowable residential density” means the density
24allowed under the zoning ordinance and land use element of the
25 general plan, or if a range of density is permitted, means the
26maximum allowable density for the specific zoning range and land
27use element of the general plan applicable to the project. Where
28the density allowed under the zoning ordinance is inconsistent
29with the density allowed under the land use element of the general
30plan, the general plan density shall prevail.

31(p) (1) Upon the request of the developer, no city, county, or
32city and county shall require a vehicular parking ratio, inclusive
33of handicapped and guest parking, of a development meeting the
34criteria of subdivision (b), that exceeds the following ratios:

35(A) Zero to one bedroom: one onsite parking space.

36(B) Two to three bedrooms: two onsite parking spaces.

37(C) Four and more bedrooms: two and one-half parking spaces.

38(2) If the total number of parking spaces required for a
39development is other than a whole number, the number shall be
40rounded up to the next whole number. For purposes of this
P15   1subdivision, a development may provide “onsite parking” through
2tandem parking or uncovered parking, but not through onstreet
3parking.

4(3) This subdivision shall apply to a development that meets
5the requirements of subdivision (b) but only at the request of the
6applicant. An applicant may request parking incentives or
7concessions beyond those provided in this subdivision pursuant
8to subdivision (d).



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