CITY OF HAWAIIAN GARDENS
CITY COUNCIL
STAFF REPORT
Agenda Item #B2
DATE: February 11, 2026
TO: Honorable Mayor and Members of the City Council
FROM: Ernesto Marquez, City Manager
BY: Elise McCaleb, Community Development Director
RECOMMENDATION:
Recommendation to adopt on second reading by title only, Ordinance No. 2026-623, amending Section 18.90.080 of the Hawaiian Gardens Municipal Code relating to Accessory Dwelling Units and Junior Accessory Dwelling Units and finding the action to be statutorily exempt from CEQA under Public Resources Code § 21080.17.
SUMMARY
The ordinance will amend Section 18.90.080 of the Hawaiian Gardens Municipal Code (HGMC) to comply with recent changes to state law that impose new limits on local authority to regulate Accessory Dwelling Units (ADUs) and Junior Accessory Dwelling Units (JADUs). Except as otherwise noted, these new laws took effect on January 1, 2026.
BACKGROUND AND ANALYSIS:
In recent years, the California Legislature has approved, and the Governor has signed into law, a number of bills that impose new limits on local authority to regulate ADUs and JADUs. In late 2025, four new bills were enacted that further amend state ADU law as summarized below.
AB 462 – Coastal Development Permits; Disaster-Affected Areas AB 462 modifies several permitting requirements associated with processing Coastal Development Permits (CDP) for ADUs located in the Coastal Zone. The City does not lie within the Coastal Zone, and so AB 462’s provisions concerning CDPs does not apply to the City and are not included in the ordinance.
Agenda Item #B2
February 11, 2026
Beyond changes to CDP processing, AB 462 modifies the rules governing the issuance of a certificate of occupancy (CofO) for an ADU. Historically, state law has prohibited a local agency from issuing a CofO for an ADU before one is issued for the primary dwelling (i.e., the primary dwelling must have a CofO before the ADU can receive one). AB 462 creates a narrow exception to this prohibition for detached ADUs when all of the following conditions are satisfied: (1) the Governor has declared a state of emergency for the county on or after February 1, 2025; (2) the primary dwelling was substantially damaged or destroyed by an event referenced in the state of emergency proclamation; and (3) the ADU has been issued construction permits and passed all required inspections. (Gov.
Code, § 66328(b).) If these conditions are satisfied, the detached ADU can receive a CofO before the primary dwelling. In all other scenarios, the primary dwelling still needs a CofO before one can be issued for an ADU. These CofO changes are reflected in HGMC Section 18.90.080(F)(9).
AB 462 was enacted as an urgency measure that took effect immediately when signed by the Governor on October 10, 2025.
The following three bills were enacted as non-urgency measures and took effect on January 1, 2026.
AB 1154 – JADU Owner-Occupancy; Short-Term Rental
When a JADU is developed, existing state law requires a property owner to reside in the JADU or remaining portion of the single-family dwelling. AB 1154 narrows this requirement to now only apply when a JADU shares sanitation facilities (bathroom) with the single-family dwelling. If the JADU has its own bathroom, then the property owner does not have to reside on the property at all. (See amended Gov. Code, § 66333(b)).
These JADU owner occupancy changes are reflected in Section 18.90.080(F)(6).
AB 1154 also expressly prohibits JADUs from being used as short-term rentals (i.e., rented for a term shorter than 30 days). (See amended Gov. Code, § 66333(g).) Most ADU ordinances already included this prohibition (as well as prohibiting ADUs from being used as short-term rentals). But now it’s required by state law. This JADU short term rental prohibition is reflected in Section 18.90.080(F)(4).
SB 9; SB 543 – ADU Ordinance Submittal to HCD; Approval Under existing law, local agencies are required to submit a copy of their ADU ordinance to the California Department of Housing and Community Development (HCD) within 60 days of adoption.
Agenda Item #B2
February 11, 2026
This year’s SB 91 and SB 543 create a penalty for failing to do so by rendering null and void any local ordinance that is not submitted to HCD within 60 days of adoption. (See amended Gov. Code, § 66326(d); new Gov. Code, § 66333.5(d).) The bills further specify that a local ADU ordinance is null and void if HCD issues findings that the ordinance does not comply with state law and the local agency fails to respond to HCD within 30 days. (Id.) In accordance with state law, the attached ordinance directs staff to submit a copy thereof to HCD within 60 days of adoption.
SB 543 – ADU Size; Number of ADUs; Impact Fees; Permitting Timeline SB 543 makes numerous changes and clarifications to state ADU law, the most notable of which are summarized below.
ADU & JADU Size
Existing law limits the maximum size of a JADU to 500 square feet and prohibits local ADU ordinances from imposing certain development standards that would prevent an ADU created under Government Code section 66314 through 66322 from being at least 800 square feet.
SB 543 amends state ADU law to specify that allowable square footage of an ADU or JADU refers to square footage of “interior livable space.” (See amended Gov. Code, § 66313(d), 66321(b)(2).) These changes are reflected in Section 18.90.080(C)(5), (E)(1)(B), (G)(1), and (H)(1).
Impact Fees
Existing law exempts ADUS that are 750 square feet or smaller from development impacts fees (DIFs).
SB 543 clarifies that DIFs may not be imposed on an ADU that has 750 or fewer square feet of interior livable space or on a JADU with 500 or fewer square feet of interior livable space.
The bill also exempts an ADU or JADU with fewer than 500 square feet of interior livable space from school impact fees. (See amended Gov. Code, § 66311.5.) These changes are reflected in Section 18.90.080(H)(1).
1 Not to be confused with the SB 9 of 2021 (Stats. 2021, Ch. 162) regarding urban lot splits and second primary dwelling units.
Agenda Item #B2
February 11, 2026
Quantity of ADUs Created Under Government Code Section 66323 Existing state law creates four categories of ADUs that must be approved if they comply with the limited standards provided in Government Code section 66323(a)(1)–(4). These are:
(1) a converted ADU and JADU created on a lot with a proposed or existing singlefamily dwelling (Gov. Code, § 66323(a)(1)); (2) a detached ADU created on a lot with a proposed or existing single-family dwelling (Gov. Code, § 66323(a)(2));
(3) converted ADUs created in an existing multifamily dwelling (Gov. Code, § 66323(a)(3)); and
(4) detached ADUs created on a lot with a proposed or existing multifamily dwelling.
For some time, there has been uncertainty as to whether ADUs created under Government Code section 66323 could be combined. Some practitioners interpreted the statute to not require local agencies to allow combinations. Initially, HCD took the same position, in its 2020 ADU Handbook. But for the last few years, HCD has taken the opposite position: that yes, combinations are permitted. (See HCD January 2025 ADU Handbook, at p. 19 [“[P]ursuant to Government Code section 66323, subdivision (a), local governments must allow units created pursuant to subparagraphs (1) and (2) together or (3) and (4) together”].)
SB 543 codifies HCD’s most recent interpretation by amending Government Code section 66323 to specifically allow combinations. Thus, a lot with a multifamily dwelling can now have a converted ADU or ADUs created under section 66323(a)(3) and detached ADUs created under section 66323(a)(4). And a lot with a single family dwelling can now have a converted ADU and a JADU created under section 66323(a)(1) and a detached ADU created under section 66323(a)(2). These changes are reflected in Section
18.90.080(E)(1).
Under the City’s current ADU ordinance, ADUs that are created under Government Code section 66323 (i.e., those described above) are referred to as Building Permit Only ADUs.
The attached ordinance changes the label for this category of ADUs to Class 1: Statutorily Regulated ADUs. (See Section 18.90.080(E)(1).) ADUs that are approved under Government Code section 66314-66322 (and referred to as ADU Permit ADUs under the current ADU ordinance) will now be referred to Class 2: Locally Regulated ADUs. (See Section 18.90.080(E)(2).) This label change is intended to help staff, the public, decisionmakers, and HCD understand which regulations apply to which ADUs.
Agenda Item #B2
February 11, 2026
ADU Permitting Process
Existing law has long required local agencies to approve or deny an ADU application within 60 days of receiving a complete application. However, state law was silent with respect to incompleteness determinations, subsequent resubmittals, and appealing local decisions on ADU applications.
SB 543 requires local agencies to now:
(1) determine whether an ADU application is complete within 15 business days of submittal;
(2) if the application is incomplete, within the same 15 days provide the applicant with a list of incomplete items and how to address them;
(3) review a resubmitted application for completeness within 15 business days; (4) provide the applicant with a written appeal process for any incompleteness determination or denial (to the Planning Commission or City Council, or both); and (5) provide a final written determination on the appeal within 60 business days of receiving the appeal). (See amended Gov. Code, §§ 66317 [ADUs], 66335 [JADUs].)
These changes are reflected in Section 18.90.080(D)(3).
NEXT STEPS & RECOMMENDATION:
AB 462 took effect immediately when signed, but technically it doesn’t require any change to a local ADU ordinance; the City just needs to follow the new rules for CDP processing and issuance of a CofO, if applicable. But the remaining bills took effect on January 1, 2026, and for the City’s ADU ordinance to remain valid and enforceable, it must comply with requirements of these bills by January 1, 2026, or the City’s entire existing ADU ordinance becomes null and void as a matter of law, and the City will have to allow ADUs with no regulation except for the few requirements imposed in the state ADU law itself.
The approval of ADUs and JADUs based solely on these default statutory standards, without local regulations governing height, setback, landscape, and architectural review, among other things, would threaten the character of existing neighborhoods and negatively impact property values, personal privacy, and fire safety. Therefore, the City Council adopted Urgency Ordinance No. 2025-622U during its December 10, 2025 regular meeting.
On December 17, 2025, the Planning Commission held a public hearing to consider the proposed ordinance and thereafter adopted Resolution No. 2025-003 (Exhibit “A”), voting to forward the proposed ordinance (Exhibit “B”) to the City Council with a recommendation in favor of its adoption. Staff recommends that the City Council proceed in accordance with the recommended actions set forth above and restated immediately below.
Agenda Item #B2
February 11, 2026
Staff recommends that the City Council adopt the second reading by title only of Ordinance No. 2026-623 and find that the adoption of the ordinance is statutorily exempt from review under the California Environmental Quality Act (CEQA) under Public Resources Code § 21080.17.
ENVIRONMENTAL REVIEW
Under California Public Resources Code section 21080.17, CEQA does not apply to the adoption of an ordinance by a city or county implementing the provisions of Chapter 13 of Division 1 of Title 7 of the California Government Code, which is California’s ADU law.
Therefore, the adoption of the Ordinance is statutorily exempt from CEQA in that it implements state ADU law.
FISCAL IMPACT
None.
SUGGESTED ACTION
Approve Recommendation.
ATTACHMENTS
A. Ordinance No. 2026-623