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Governor Signs AB t866: Second Units and Density Bonuses <br /> <br /> Despite numerous veto request letters from local governments, and late opposition from <br /> several environmental groups and the Farm Bureau, the Governor signed AB 1866 which (1) <br /> eliminates local discretionary reviews of second unit applications, and (2) prohibits local <br /> governments from applying any local "development standard" which is defined as "any <br /> ordinance, general plan element, specific plan, charter amendment, or other local law, po/icy, <br /> regulation or condition"that will have the effect of precluding the development of the density <br /> bonus units. <br /> <br /> To protect your local authority, local governments are advised to immediately prepare for the <br /> implementation of this legislation by considering significant revisions to their second unit <br /> ordinances in anticipation of having the ability to make local discretionary decisions removed, in <br /> addition, your city attorney should review the density bonus provisions immediately. The <br /> language passed by the Legislature is severely flawed, and is certain to lead to more lawsuits <br /> than housing. <br /> <br /> AB 2292 (Dutra) Anti-Down Zoning, Signed by the Governor <br /> <br /> Despite the lobbying effort by local govemments, AB 2292 (Durra) was signed by the <br />Governor as Chapter 706, Statutes of 2002. This bill will expose local governments to lawsuits if <br />they approve a down zoning or rezoning without ensuring that other lands are up zoned so that <br />there is no net loss of multifamily-zoned land, at density levels approved by the Department of <br />Housing in the jurisdiction's housing element. Any deviation from these requirements exposes a <br />local government to lawsuits and mandatory attorneys fees. Although affordable housing <br />advocates tout this measure as part of a solution to the decline in production of multifamily <br />housing, it only works for those who subscribe to the theory that the reason that multi-family <br />housing has dropped to such abysmally Iow production levels is because of local government <br />and resident efforts to deny these units. <br /> <br /> The experience of many city officials, however, is that private developers - even for projects <br />built in the middle of farmland --fait to demonstrate sufficient interest in building multifamily <br />housing. Multifamily construction tends to be on the polar ends of the market: high upscale <br />apartments or Iow-income units built with government subsidizes. Private developers often state <br />that new duplexes, four-plexes, and larger apartments fail to "pencil out." Some have pointed to <br />the effects of the 1986 Federal Tax Reform Act, construction defect litigation, the California <br />Environmental Quality Act, and neighborhood resistance as reasons for this phenomenon. But <br />often the most compelling factors are the extensive consumer surveys that demonstrate that the <br />market demand -- and therefore the most profit potential -- in single-family detached <br />construction. <br /> <br /> The effect of this legislation should be closely monitored. We believe it will reveal whether or <br />not it makes sense to continue the current approach of centralized state planning for housing, <br />driven by corn plex formulas and the mandate that every jurisdiction must do its '~air share" to <br />meet an assigned number. If the housing advocates are right, and the problem with the market <br />all along has been the recalcitrance of local governments, then presumably we should see a <br />resurgence of private sector interest in building multifamily housing because land will be zoned <br /> <br /> Page 4 of 13 <br /> <br /> <br />