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SB 8, 9, 10 New Housing Legislation: FAQ for Owners, Developers and Public Entities

It is rare that State legislation regarding city planning creates such a public furor as the Governor’s recent signing of three related bills, SB 8, 9, and 10, has caused. SB 9 has received
the bulk of the attention, with some calling it the death of single-family zoning in California. While that may be an exaggeration, SB 9 does have the potential to enable the development of a
great many additional dwelling units in single-family zones.

We have been deluged with questions about these bills. Here are some of the most common questions and our answers. Some of the answers are by nature tentative, as the bills bear all of the earmarks of compromise legislation with many issues left to be worked out by cities/counties,1 the California Department of Housing and Community Development (“HCD”),
and the courts in the future. For example, SB 9 itself amends or adds three sections to the Government Code, and among them contains some 78 subparts, no fewer than 14 of which begin with the phrase “notwithstanding [some other section in the new law].”

QUESTION: This legislation is a surprise. Did it come out of the blue?

ANSWER: Not really. The State first declared a housing crisis in 1975 and shortly thereafter passed the Housing Accountability Act (Sec. 65589.5), limiting the grounds to deny housing projects. The State also started to stiffen requirements for cities to plan for adequate housing in the housing element of their general plan, including by the adoption of RHNA numbers (Regional Housing Needs Allocation), and through the Density Bonus Law (Sec. 65915) required cities to give density bonuses and other incentives to affordable housing developers. More recently, highly publicized laws have included SB 330 (restricting growth controls, delays in completeness determinations, subjective design review, etc.), SB 35 (ministerial approvals for certain affordable projects), and the legislation mandating the availability of accessory dwelling units (“ADUs”).

Some state legislators have been trying for years to eliminate single-family zoning. Minneapolis and Portland, Oregon have done so, and pressure has been put on cities in the Bay Area to follow suit. Earlier this year Berkeley voted to follow their lead, which is interesting considering that Berkeley is credited as having adopted the very first single-family zoning ordinance in the country (in 1916). The rationale to eliminate single-family zoning has been both to increase the supply of housing and to try to erase the legacy of such zoning having been used as an exclusionary tactic to promote racial segregation.

QUESTION: Why three bills? How are they related?

ANSWER: Actually, there are more housing bills, including an additional 27 (!) that the Governor signed the following week. These additional bills are more narrowly focused on
specific issues than those discussed in this article. SB 8, 9, and 10 each attack a different aspect of the perceived housing problem. In overview (with more details below) SB 8 makes a number
of technical changes to various housing laws, including the definition of a housing development project in certain circumstances to include a single dwelling. It also extends the state-declared
emergency from 2025 to January 1, 2030, which should allow for additional certainty in planning large projects.

SB 10 is different from the other two in that it allows cities to adopt an ordinance to zone a parcel for up to 10 residential units (plus two ADUs and two junior ADUs per parcel) on a site
that is either in a “transit-rich area” or is an “urban infill” site, as these terms are defined in the statute. The adoption of such a zoning ordinance is exempt from analysis under the California
Environmental Quality Act (“CEQA”). The ordinance would override a restriction imposed by initiative if passed by a 2/3 vote of the city council.

But SB 9 is the key player among the three bills. As will be discussed more fully below, it essentially requires cities to approve two residences on one parcel and to allow lot splits in all
single-family residential zones in the State. With prior laws, this potentially allows an existing single-family lot with one dwelling now to be split in two, and for each of the new lots to have a
duplex or a new house (potentially along with an ADU and a Junior ADU). There are many restrictions and caveats, which we will get into below.

QUESTION: Do the state housing laws now apply to applications to build only one house?

ANSWER: Partly. The ancestor of these laws, the Housing Accountability Act, defines a “housing development project” as a use consisting of either a mixed-use development or of
“[r]esidential units only” (Sec. 65589.5(h)(A)). Because of the plural term “units,” that definition has been interpreted by most practitioners and by HCD to apply only to projects consisting of
two or more residences, including a single-family residence with an accessory dwelling unit. SB 8, however, contains a new definition of “housing development project” which
includes “a proposal to construct a single dwelling unit.” (Sec. 65905.5(b)(3)(C)). The statute goes on to say, however, that the new definition does not apply to the Housing Accountability
Act.

Nonetheless, SB 8 amends other housing laws to include the new definition within their scope. This includes various provisions of SB 330, which, for example, limit the number of
hearings a city may hold on a project and the ability of a city to declare projects incomplete. In other words, there are now two different of definitions of “housing development project”
applicable to different laws offering different protections to developers and different restrictions upon the discretion of approving entities. (Sec. 65905.5, 65913.10, 65940).

QUESTION: Does SB 9 really eliminate single-family zoning in California?

ANSWER: Not technically, but in most urban areas, it does allow development inconsistent with traditional concepts of single-family zones. SB 9 adds to the Government Code
a new Section 65852.21, which requires that a housing development proposal containing no more than two residential units within a single-family residential zone must be considered
ministerially by a city – even if both are on the same parcel. In other words, the city cannot apply discretionary review or require a hearing if the proposal satisfies certain requirements that are
laid out in that code section.

SB 9 also adds Section 66411.7 as part of the Subdivision Map Act; this provides that most urban single-family lots can be split in two, again with certain qualifications. Finally, it
makes minor amendments to another provision of the Subdivision Map Act (Sec. 66452.6) to allow additional time for tentative maps to remain in force before they are finaled.

QUESTION: Does SB 9 apply everywhere in the state?

ANSWER: Yes, it applies in all urbanized areas. Furthermore, it is expressly made applicable to all cities, including charter cities. We note that although practitioners generally felt
that the Housing Accountability Act always applied to charter cities, a trial court decision in the county of San Mateo had determined that not to be the case. However, that result was just
overturned on appeal, Cal. Renters Legal Advocacy & Educ. Fund v. City of San Mateo, 68 Cal. App. 5th 820 (2021), with the appellate court holding explicitly that the Housing Accountability
Act did apply to charter cities. We expect future housing legislation also to be applicable to charter cities.

QUESTION: Are all single-family zoned parcels eligible for SB 9 treatment?

ANSWER: No. Under SB 9, a parcel must meet certain specific criteria to be eligible for ministerial approval of dwellings or to be split in two, including:

  1. It must be in an urban area (city or county).
  2. It must meet the same restrictions as contained in SB 35, Sec. 65913.4(a)(6)(B)-(K). These are primarily environmental, including that it not be located on a site that is: prime farmland, habitat for special status species, wetlands, in a high fire hazard severity zone, a hazardous waste site, in a delineated earthquake fault zone, in a flood hazard zone, or included in an adopted natural community conservation plan or under a conservation easement.
  3. It cannot be in a historic district nor be a designated historic landmark.
  4. The new project cannot demolish more than 25% of the existing exterior structural walls unless a local ordinance so allows, or unless the site has not been occupied by a tenant in the last three years.
  5. It cannot require demolition of affordable housing, or housing that is subject to rent or price control, or that has been occupied by a tenant in the last three years.

QUESTION: Can a city deny residential permits or a lot split under SB 9?

ANSWER: As with the Housing Accountability Act and other housing laws, a city can deny an SB 9 project only if it can find that the project would have a specific, adverse impact that cannot be mitigated on public health and safety or the physical environment. The city can apply objective zoning, subdivision, and design standards, but not if they would physically preclude the construction of two units on either of the resulting parcels or would result in a unit size less than 800 square feet. (Sec. 66411.7(c), (d); 65852.21(b)(1), (2)(A)). Thus, local ordinances concerning neighborhood compatibility or preservation of views that would otherwise prevent new structures from being built so close to property lines cannot be applied.

QUESTION: What limits can a city put on the lot split?

ANSWER: As stated above, a city must apply objective zoning, subdivision, and design review standards to the lot split, provided they are not in conflict with SB 9. However, they must allow for division into two almost equal size lots. More precisely, the smaller lot must be at least 40% of the size of the original lot. (Sec. 66411.7((a)). The lots may be as small as 1200 square feet! The only rear or side setbacks that the city can require are limited to four feet, similar to the setback allowed for ADUs. No offsite improvements or dedications can be required other than public service easements (Sec. 66411.7(b), (c), (e)). Note that parcels in a Coastal Zone remain subject to the Coastal Act.

QUESTION: Can parking be required?

ANSWER: No more than one parking space can be required for each residence on one parcel or on newly split lots. If the residences are within one-half mile of a high-quality transit corridor or a major transit stop, or even have a ride share vehicle within one block, then no parking spaces can be required. (Sec. 65852.21(c)). The city can require that each lot have access to the street (Sec. 66411.7(e)(2)).

QUESTION: Can the resulting residences also have ADUs?

ANSWER: This is a tricky area, and unfortunately the best answer is “yes and no.” If an owner seeks to build two houses on one parcel, without a ministerial lot split, then the parcel can presumably have at least one ADU and one junior ADU under normal ADU laws. Under SB 9, if a ministerial lot split is sought, however, the city cannot be required to permit more than two total units per new parcel, including ADUs (Sec. 66411.7(j)). And if an owner uses both features of SB 9 by splitting the lot and then applying for a ministerial residential permit on each new lot, the city is not required to allow either an ADU or a junior ADU on either parcel. (Sec. 65852.21(f)).

QUESTION: Are there other restrictions on the use of the split lots?

ANSWER: Yes, including the requirement that the applicant for a lot split sign an affidavit stating that the applicant intends to occupy one of the units as their principal residence for a minimum of three years. (Sec. 66411.7(g)). Furthermore, the city must restrict the rentals of units on the split lots to periods longer than 30 days (in other words, no short-term vacation rentals). (Sec. 66411.7(h)).

QUESTION: What CEQA review is required, if any?

ANSWER: The lot splits and the housing approvals contemplated by SB 9 are explicitly stated to be “ministerial” in nature. A ministerial approval is not subject to CEQA, since CEQA only applies to discretionary approvals. Therefore, no CEQA analysis will be done of individual lot splits or housing permits. Similarly, SB 10 specifically states that the upzonings that a city may make are not projects under CEQA, though approval of a project with more than 10 units is specifically made subject to CEQA. (Sec. 65913.5(c)(1)).

QUESTION: Are there still unanswered questions about these bills?

ANSWER: Yes, very many, as some of the equivocation in the preceding analysis evidences. The legislation has many gaps and loopholes. We look forward to exploring them with interested readers, who should feel free to contact the author or his firm for further discussion.


Andrew Faber practices in the areas of Land Use and Municipal Law. He has over forty years of experience in representing private and public clients in a wide range of land use, environmental and public law matters, and in real estate, environmental and eminent domain litigation.

If you have any questions, please contact Andrew Faber at andrew.faber@berliner.com or (408) 286-5800, or other members of the team: Jolie Houston, jolie.houston@berliner.com and Erik Ramakrishnan, erik.ramakrishnan@berliner.com.

This article is intended for informational purposes only and not for the purpose of providing legal advice. Please contact your attorney to obtain advice with respect to any particular legal issue. The analysis and opinions expressed are solely those of the author.

 


These laws generally apply to urban areas, whether they be in the jurisdiction of a county or a city. In our home county of Santa Clara, most development occurs in cities, but other counties have a larger share of urban development. To avoid using the clumsy term “cities/counties” in this article I will use the term “cities” alone, with the understanding that the laws apply to counties as well. As an additional housekeeping matter, all references to a section of State law refer to a section of the Government Code.

 

 

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