BILL ANALYSIS Ó
AB 1934
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Date of Hearing: April 20, 2016
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Susan Talamantes Eggman, Chair
AB 1934
(Santiago) - As Amended April 14, 2016
SUBJECT: Planning and zoning: density bonuses: mixed-use
projects.
SUMMARY: Creates a density bonus for commercial developers that
partner with an affordable housing developer to construct a
mixed-used development. Specifically, this bill:
1)Requires, when an applicant for approval for commercial
development agrees to partner with an affordable housing
developer to construct a mixed-use project for which the
housing will be located onsite and the proposed commercial
development, the city, county, or city and county shall, in
addition to any density bonus and incentives or concessions
granted to the affordable housing developer pursuant to
existing law, to grant a density bonus pursuant to 2), below,
to the commercial developer.
2)Specifies that the density bonus granted to the commercial
developer shall mean exceptions resulting in significant cost
reductions over the maximum allowable intensity in the general
plan, zoning ordinance, or other regulation of the city,
county, or city and county, including, but not limited to,
floor area ratios, and may include modification to development
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standards, such as height and parking requirements.
3)States that the Legislature finds and declares that the
development of affordable housing is a matter of statewide
concern and is not a municipal affair, as specified, and that
the bill's provisions apply to all cities, including charter
cities.
4)States that no reimbursement is required because a local
agency has the authority to levy service charges, fees, or
assessments sufficient to pay for the program or level of
service mandated by this act, as specified.
EXISTING LAW:
1)Defines "density bonus" as a density increase over the
otherwise maximum allowable residential density as of the date
of application by the applicant to the local government.
2)Requires all cities and counties to adopt an ordinance that
specifies how they will implement state density bonus law.
3)Requires local governments to grant a density bonus when an
applicant for a housing development of five or more units
seeks and agrees to construct a project that will contain at
least any one of the following:
a) 10% of the total units for lower-income households;
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b) 5% of the total units for very-low income households;
c) A senior citizen housing development or mobilehome park;
and,
d) 10% of the units in a common-interest development (CID)
for moderate-income households.
4)Requires that the applicant agree to continued affordability
of all low- and very low-income units that qualified the
applicant for the density bonus for at least 30 years.
5)Specifies that concessions or incentives may include the
following:
a) A reduction in site development standards or a
modification of zoning code requirements or architectural
design requirements that exceed the minimum building
standards;
b) Approval of mixed-use zoning in conjunction with the
housing project if commercial, office, industrial, or other
land uses will reduce the cost of the housing development
and are compatible with the project and the surrounding
area; and,
c) Other regulatory incentives or concessions proposed by
the developer or the local government that result in
identifiable, financially sufficient, and actual cost
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reductions.
6)Requires local governments to provide applicants with the
following number of incentives or concessions:
a) One incentive or concession for projects that include at
least 10% of the total units for lower-income households,
at least 5% for very low-income households, or at least 10%
for persons and families of moderate income in a common
interest development;\
b) Two incentives or concessions for projects that include
at least 20% of the total units for lower-income
households, at least 10% for very low-income households, or
at least 20% for persons and families of moderate income in
a common interest development.
c) Three incentives or concessions for projects that
include at least 30% of the total units for lower-income
households, at least 15% for very low-income households, or
at least 30% for persons and families of moderate income in
a common interest development.
FISCAL EFFECT: This bill is keyed fiscal.
COMMENTS:
1)Bill Summary. This bill requires, when an applicant for
approval for commercial development agrees to partner with an
affordable housing developer to construct a mixed-use project
for which the housing will be located onsite and the proposed
commercial development, the city, county, or city and county
to, in addition to any density bonus and incentives or
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concessions granted to the affordable housing developer
pursuant to existing law, to grant a density bonus to the
commercial developer. Additionally, the bill specifies that
the density bonus granted to the commercial developer shall
mean exceptions resulting in significant cost reductions over
the maximum allowable intensity in the general plan, zoning
ordinance, or other regulation of the city, county, or city
and county, including, but not limited to, floor area ratios,
and may include modification to development standards, such as
height and parking requirements. The bill also finds and
declares that the development of affordable housing is a
matter of statewide concern and is not a municipal affair,
thereby applying the provisions of the bill to all cities,
including charter cities.
This bill is an author-sponsored measure.
2)Author's Statement. According to the author, "Local
governments can be wary of high density residential
development because of the corresponding increase in demand
for public services and infrastructure. In an era of tight
budgets, local governments are also more likely to approve
commercial developments which will increase revenues.
"AB 1934 seeks to marry these two needs: a) the state's need
for affordable housing; and
b) local governments' desire for increased revenues, by
encouraging non-traditional housing developers to enter the
market and think outside the box in their developments."
3)Background. In 1979, the Legislature enacted density bonus
law to help address the affordable housing shortage and to
encourage development of more low- and moderate-income housing
units. Density bonus is a tool to encourage the production of
affordable housing that is used by both market rate and
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affordable housing developers. In return for inclusion of
affordable units in a development, developers are given an
increase in density over a city's zoned density and
concessions and incentives. The increase in density and
concessions and incentives are to offset the cost of the
affordable units which will be offered at a lower rent, as low
as 30% of area median income. Developers that seek a density
bonus must agree to restrict very low- and low-income rental
units to affordable levels for 55 years.
State law specifies concessions and incentives that a local
government may include in its density bonus ordinance,
including a reduction in site development standards, or a
modification of zoning code requirements, or architectural
design requirements that exceed the minimum building
standards, and approval of mixed-use zoning in conjunction
with the housing project if commercial, office, industrial, or
other land uses will reduce the cost of the housing
development and are compatible with the project and the
surrounding area. A developer or city can also propose other
regulatory incentives or concessions that result in
identifiable, financially sufficient, and actual cost
reductions.
4)Arguments in Support. Supporters argue that the bill's
proposed solution meets the needs of local governments for
economic development, along with the construction of
affordable housing for the individuals and families who work
in our communities and will be helpful to encourage affordable
housing construction.
5)Arguments in Opposition. Opponents are concerned that the new
statutory framework proposed by the bill may result in
requests for local agency concessions that may not be
warranted, or which may unnecessarily limit authority to
review development applications and ensure consistency with
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local plans. Opposition also points to the lack of definitions
for "commercial" development and "partners" in the bill.
6)Double-Referral. This bill was heard by the Housing and
Community Development Committee on April 13, 2016, where it
passed with a 6-0 vote.
REGISTERED SUPPORT / OPPOSITION:
Support
California Apartment Association
California Association of Realtors
California Council for Affordable Housing
Concerns
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California State Association of Counties
Housing California
Opposition
American Planning Association, California Chapter
League of California Cities
Analysis Prepared by:Debbie Michel / L. GOV. / (916) 319-3958