BILL ANALYSIS Ķ
SENATE COMMITTEE ON GOVERNANCE AND FINANCE
Senator Robert M. Hertzberg, Chair
2015 - 2016 Regular
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|Bill No: |AB 744 |Hearing |7/15/15 |
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|Author: |Chau |Tax Levy: |No |
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|Version: |7/8/15 |Fiscal: |Yes |
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|Consultant|Favorini-Csorba |
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PLANNING AND ZONING: DENSITY BONUSES
Places a cap on the parking ratios that local governments may
impose on some affordable housing developments.
Background and Existing Law
Local Planning. Cities and counties must adopt general plans
with seven specified elements, including a land use element that
contains standards for population density and building profiles.
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, charter cities' zoning ordinances
and conditional use permits don't have to be consistent with
their general plans.
Local ordinances can set a variety of rules intended to shape
developments, including setting maximum densities for housing
units or minimum numbers of required parking spaces. These
parking space requirements are often based on a "parking ratio"
that requires builders to include a certain number of parking
spaces per unit, depending on the size of the unit. High
parking ratios can increase the cost of housing because
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constructing off-street parking can be expensive. For example,
estimates of the average cost of constructing parking spaces
range from $15,000 to $34,000 per space.
Density Bonus Law. Given California's high land and
construction costs, it can be difficult for developers to
provide housing units that are affordable to low- and
moderate-income households. In order to improve the financial
viability of developments that provide housing at a cost below
the market rate, the state enacted the Density Bonus Law, which
allows a development that meets certain criteria to include more
total units in a project than would otherwise be allowed by
local zoning. To be eligible for a density bonus, a development
must do any of the following:
Reserve at least 10% of the units for lower income
households;
Reserve at least 5% of the units for very low income
households;
Be either a senior citizen housing development or a
mobile home park for older persons, as defined in the Civil
Code; or
Reserve at least 10% of the units in a common interest
development for people of moderate income, as long as all
units are available for purchase by the general public.
These affordable housing units must remain affordable for at
least 55 years. Developers that meet the requirements in
density bonus law receive several other benefits in addition to
higher allowable densities, including "concessions" such as
regulatory exemptions that result in cost reductions and waivers
of development standards that would physically prevent the
development from being constructed. Density bonus law also caps
the parking ratio that a local government may require at:
1 parking space per unit with zero or one bedroom;
2 parking spaces per unit with two or three bedrooms;
2.5 parking spaces per unit with four or more bedrooms.
Developments that include higher percentages of low or very low
income households get higher allowable housing densities and
other benefits, up to maximum percentages of 20% low income or
11% very low income. For example, a housing project with only
5% of very low income housing is entitled to a 20% increase in
density, one concession, unlimited waivers from development
standards, and reduced parking standards for the entire project.
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A housing project with 11% very low income units receives a 35%
increase in density, two concessions, and the same access to
waivers and reduced parking standards.
State Transit Policies. A number of state policies encourage
new developments near public transit in order to reduce vehicle
miles traveled. The Planning and Zoning Law declares three
state planning priorities, including encouraging efficient
development patterns. That priority can be furthered by new
development that uses land efficiently, is adjacent to developed
areas, is planned for new growth, is served by adequate
transportation, and minimizes taxpayers' continuing costs. In
addition, California has a goal of reducing greenhouse gas
emissions (AB 32, Nuņez & 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, Senate Bill 375 (Steinberg, 2008) linked
transportation planning and land use planning by state,
regional, and local agencies by providing metropolitan planning
organizations and their constituent cities and counties with,
among other things, incentives to promote development within
one-half mile of a "major transit stop." SB 375 defines a major
transit stop to mean a site containing an existing rail transit
station, a ferry terminal served by either a bus or rail transit
service, or the intersection of two or more major bus routes
with a frequency of service interval of 15 minutes or less
during the morning and afternoon peak commute periods.
Some organizations want to further encourage affordable housing
development near transit by reducing the number of parking
spaces that are required for certain new developments.
Proposed Law
Assembly Bill 744 adds several provisions to the density bonus
law that reduce the parking ratios that cities and counties may
impose on new developments that meet certain criteria.
Specifically, AB 744:
Prohibits local governments from requiring parking
ratios greater than 0.5 spaces per unit for a development
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that includes, at least 20% low income or 11% very low
income housing units and is within one-half mile of a major
transit stop, as defined by state law.
Prohibits local governments from requiring parking
ratios greater than 0.5 spaces per unit for a development
that is entirely composed of low or very low income rental
housing units and is within mile of a major transit stop.
Prohibits local governments from requiring parking
ratios greater than 0.5 spaces per unit for a development
that:
o Is a senior citizen development renting to
individuals 62 years of age or older;
o Is entirely composed of low or very low income
rental housing units, and;
o Has paratransit or is located within mile of
a bus line that runs at least eight times per day.
Prohibits local governments from requiring parking
ratios greater than 0.3 spaces per unit for a development
that:
o Is a special needs housing development,
defined as a development for the benefit of persons
with mental health needs, physical or developmental
disabilities, or those at risk of homelessness;
o Is entirely composed of low or very low income
rental housing units, and;
o Has paratransit or is located within mile of
a bus line that runs at least eight times per day.
These ratios include parking set aside for guests and
handicapped spaces. The affordable housing developments near
transit that qualify under AB 744 must provide unobstructed
access to the transit stop that they are near, meaning that a
resident must be able to access the stop without encountering
natural or constructed impediments.
AB 744 also allows a local government to impose a parking ratio
up to the ratios allowed in current law, for developments that
receive density bonuses if the local government makes findings
that a higher parking ratio is needed, based on findings in any
parking study conducted for the area by an independent
consultant in the past seven years that demonstrates the need.
AB 744 also allows developers that receive density bonuses to
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use a concession to request changes to parking restrictions
beyond those established by the bill. It also states that it
does not prevent a local government from reducing or eliminating
parking requirements, for any development in any location and
includes findings and declarations identifying the need for its
provisions.
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill . In some cases, cities and counties
apply minimum parking standards to affordable housing
developments that do not reflect the demand from tenants for
parking. These projects may be close to transit stations or
home to seniors or individuals with special needs who drive less
frequently and have fewer vehicles. Parking spaces, which
sometimes go unused, can significantly increase the cost of
construction. This bill promotes affordable housing by enabling
developers to invest in building more affordable dwelling units
instead of spending funds on parking spaces that may go unused.
AB 744 also encourages building of urban infill,
transit-oriented development, and senior and special needs
housing by providing benefits to those categories of
development. It also ensures the mobility of residents of these
developments by only granting a benefit to developments in
locations that provide residents with access to alternative
forms of transportation, such as transit and paratransit.
Finally, AB 744 provides flexibility to locals because it allows
cities to establish parking standards suitable for their
specific circumstances upon demonstration that the greater
parking requirements are necessary.
2. Home rule . Local governments must balance competing
priorities when determining the amount of parking that is
required for new developments. Cities must look at the broader
impacts on the community that result from inadequate parking for
new development. Residents and the guests or service providers
of those residents who are unable to find a place to park within
their development will look elsewhere, such as city streets or
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parking lots for businesses. This spillover can hurt nearby
businesses, by taking parking spaces that would otherwise be
used by customers and can engender community resistance to these
types of projects as nearby residents become concerned about the
projects' impacts. That's why we elect local leaders to make
these decisions.
3. Sure, but will it work? For market-rate housing, it makes
sense to let the market determine how much parking a housing
development needs. Market-rate housing developers have an
incentive to identify the amount of parking that potential
residents demand because residents can pay similar prices
elsewhere if their demand isn't met. However, with affordable
housing, the market may not function as well. Buyers and
renters seeking affordable housing have fewer options. Housing
developers may choose to build the minimum amount of parking
allowable under law in order to maximize revenue, and low-income
residents may live there anyway, regardless of whether the
available transit and parking options meet their needs. For
example, transit options may not be adequate for residents who
travel to their jobs outside peak commute periods. The
Committee may wish to consider amending AB 744 to ensure that
residents of developments with these lower parking ratios have
easy access to necessary transportation, by reducing the
distance to transit for a project to be eligible for the lower
parking minimums or adjusting the requirements of what
constitutes a major transit stop for the purposes of the bill.
4. Mandate . The California Constitution generally requires the
state to reimburse local agencies for their costs when the state
imposes new programs or additional duties on them. According to
the Legislative Counsel's Office, AB 744 creates a new
state-mandated local program because it increases the duties of
local officials who must award density bonuses. AB 744 says
that if the Commission on State Mandates determines that it
creates a state-mandated local program, the state must reimburse
local agencies by following the existing statutory process for
mandate claims.
5. Charter cities . 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
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municipal affair or whether it's an issue of statewide concern.
AB 744 includes a legislative finding and declaration that the
need to address infill development and excessive parking
requirements is a matter of statewide concern, so its
requirements apply to all cities and counties in California,
including charter cities and counties.
6. Incoming! The Senate Transportation and Housing Committee
approved AB 744 by a vote of 7-4 on July 7, 2015.
Assembly Actions
Assembly Housing and Community Development Committee: 6-1
Assembly Local Government Committee: 7-2
Assembly Appropriations Committee: 12-4
Assembly Floor: 52-24
Support and
Opposition (7/9/15)
Support : American Planning Association-California Chapter;
California Association of Local Housing Finance Agencies;
California Council for Affordable Housing; California Apartment
Association; California Association of Local Housing Finance
Agencies; California Economic Summit; California Housing
Consortium; Circulate San Diego; Council of Infill Builders;
Domus Development; Donald C. Shoup, Professor of Urban Planning;
Housing Authority of the City of Alameda; LifeSTEPS; LINC
Housing; Local Government Commission; Natural Resources Defense
Council; Non-Profit Housing Association of Northern California;
San Francisco Mayor Edwin Lee; Brian Stanke; Richard Hedges;
Daniel Gomez; Jason Burstis; William Chapin; Tanya Narath; Jean
Long; Gerard Sorensen; Jennifer West;
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Opposition : City of Camarillo; City of Encinitas; City of
Lakewood; County of Los Angeles; League of California Cities.
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