PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #12.C
SUBJECT/TITLE:
HOUSING LEGISLATION UPDATE AND DIRECTION
RECOMMENDATION:
Receive a report on 2022 housing legislation and provide direction to staff.
SUMMARY:
The 2022 Legislative Session ended on September 1, 2022. During this period, 2,345 bills were introduced. Of the introduced bills, 1,166 bills proceeded to the Governor’s desk, with the Governor signing 997 bills and vetoing 169 bills. Most of the legislation signed by the Governor addressed the housing crisis, continued economic recovery following the COVID-19 pandemic, and community sustainability and resiliency. Many of the housing related bills reduce local control in the review and processing of housing permit applications. Staff has been tracking major legislation with implications for Pismo Beach. This report is not a comprehensive analysis of all legislation signed at the end of the 2022 legislative session, but rather an analysis of major topic areas affecting the City, specifically regarding housing. These major topic areas include Assembly Bill 2011 and Senate Bill 6, accessory dwelling units, parking, permit streamlining, and climate resiliency. Staff will implement several bills simply as a matter of practice, while additional direction is necessary for implementation of certain legislation.
BACKGROUND:
Assembly Bill 2011 and Senate Bill 6
Two of the most contentious housing bills of the 2022 Legislative Session were Assembly Bill (AB) 2011 (Wicks) and Senate Bill (SB) 6 (Caballero). While these two bills are uniquely different, they are often discussed in the same context, as their goals are to reduce or eliminate local discretion and allow housing on property not zoned for residential use. These two bills will give developers the choice to decide the strategy to use when approaching a housing development project in a non-residential zone; either comply with stricter labor standards or stricter affordability standards.
Under AB 2011, residential developments are ministerially approved and exempt from review under the California Environmental Quality Act (CEQA) in zones where office, retail, or parking are a principally permitted use. Under the law, “principally permitted use” means a use that may occupy more than one-third of the square footage of designated use on the site and does not require a conditional use permit. Additionally, the site needs to be in an urbanized area with at least 75% of the site adjoins parcels developed with “urban uses,” which means any current or former residential, commercial, public institutional, transit or transportation passenger facility, or retail use. However, these sites cannot be located within 500 feet of a freeway. Due to US 101 bisecting the city, this will limit the ability for developers to utilize AB 2011. Residential “developments”, as that term is defined under AB 2011, are required to be multifamily developments of five or more
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homes for sale or rent with 100% of the units restricted for lower-income households for 45-55 years depending on whether the units are for sale or rent, and must pay prevailing wage.
The second Bill, SB 6, does not require a ministerial approval process like that of AB 2011. Instead, SB 6 makes these projects an “allowable use” if located in a zone where office, retail, or parking are a principally permitted use, on a site less than 20 acres, and in an urbanized area that is not adjoined to a site with more than 1/3 dedicated to industrial use. Interestingly, there are no affordability requirements under SB 6. Instead, prevailing wage and skilled and trained workforce are required. However, local governments can adopt more stringent inclusionary housing requirements for SB 6 projects and developments must meet applicable objective standards related to design, parking, and zoning.
The City will need to develop local ordinances addressing both AB 2011 and SB 6 by July 1, 2023. Should the Council provide direction to move forward with ordinance development, staff will communicate with Coastal Commission staff on how to appropriately address the Bills in compliance with the Coastal Act.
Accessory Dwelling Units
After major accessory dwelling unit (ADU) legislation in 2020, and a mild ADU year in 2021, in 2022, SB 897 (Wieckowski) came to be the most impactful ADU legislation of the year. The Bill requires cities to modify ADU regulations to increase the maximum height of detached ADUs from 16 to 18 feet for parcels with existing or proposed multistory single-family or multifamily dwelling unit, as well as up to 25 feet for an ADU attached to the primary dwelling. This is a major change from the way cities have regulated ADUs to be accessory to the primary dwelling and is intended to allow options and creativity in the design of ADUs. SB 897 continues to require the harmonization of the new regulations with the Coastal Act, so staff will need to develop regulations that continue to maintain height limitations in accordance with the Local Coastal Program for certain planning areas in the Coastal Zone.
Post-Entitlement Phase Application Information
In an effort to make the post-entitlement phase of projects easier to navigate, AB 2234 (Rivas, Robert) requires a local agency to compile a list of information needed to approve or deny a post-entitlement phase permit to post an example of a complete, approved application and an example of a complete set of post-entitlement phase permits for at least five types of housing development projects, including but not limited to, accessory dwelling unit, duplex, multifamily, mixed use, and townhome. This Bill requires this information to be made available to all applicants for these permits no later than Jan. 1, 2024. This Bill also requires a digital permitting system be implemented by 2028 for a jurisdiction the size of the city. While the focus of this Bill is consistent with the Pismo FAST program by providing useful information to the public and allowing digital submittals, this is likely to necessitate consultants to produce example plans to help guide applicants in their plan development.
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Parking Requirement Limitations
Assembly Bill 2097 (Friedman) prohibits a city from imposing any minimum parking requirement on any residential, commercial, or other development project that is located within one-half mile of public transit. For this Bill, public transit is defined the same as it is in Section 21155 of the Public Resources Code, as either a high-quality transit corridor or a fixed route bus service with service intervals no longer than 15 minutes during peak commute hours. The city does not contain transit with these service levels and therefore no changes need to occur at this time. This will be an item to monitor in upcoming legislative sessions to ensure these transit service levels are not lowered.
Religious Affiliated Housing
Assembly Bill 2244 (Wicks) limits a city’s ability to require parking for housing developed by religious institutions to 50% of that required for a brand-new place of worship. This measure applies to both existing parking spaces and those parking spaces required of a proposed development. While Pismo Beach has several places of worship, there has been no interest in the development of housing on any of these sites. Additionally, most of these sites are not large enough to accommodate housing of the scale to make fiscal sense. Accordingly, no action is required at this time.
General Plans
Two Bills were passed this year that make specific requirements related to general plans.
The first, SB 1425 (Stern), requires the City to review and update its local open-space plan by Jan. 1, 2026, to include plans and an action program that address specified issues, including climate resilience and other co-benefits of open space, in correlation with the Safety Element. Since the City is currently updating the General Plan/Local Coastal Program, staff will work with the existing consultants to ensure the Open Space Element meets the requirements of SB 1425.
The second bill, SB 932 (Portantino), requires that when a city undertakes a substantive revision to its circulation element on or after January 1, 2025, the city includes policies that aim to eliminate fatal and serious injuries for all road users through a holistic view of the roadway system. SB 932 also requires cities to develop bicycle, pedestrian, and traffic calming plans based on specific requirements and with the intent for completion within 25 years. The City is planning to initiate an update to its bicycle plan in the coming months and will update other plans in accordance with the requirements of SB 932.
Emergency Shelters
Assembly Bill 2339 (Bloom) revises the requirements of the housing element, and subsequently the zoning code, that requires emergency shelters be subject to specified written, objective standards. This builds on previous legislation that required cities to allow emergency shelters without discretionary permits, making it easier and more predictable to establish emergency shelters in specified zoning districts. As part of the GP/LCP update, the City is implementing provisions of the Housing Element into the Zoning Code.
Staff will work with the Zoning Code consultants to ensure proposed revisions are following applicable laws.
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Coastal and Climate-centric Legislation
The final two Bills are centered on coastal communities and climate resiliency. The first bill, AB 2160 (Bennett), amends the Coastal Act to authorize a city or county to waive or reduce coastal development permit fees for public access or habitat restoration projects at the request of the applicant. Should a city deny the fee waiver or reduction request, AB 2160 allows the applicant to submit the coastal development permit applications directly to the Coastal Commission. Since the City is the primary applicant for access projects, this is not anticipated to be of issue for the City.
On the topic of climate resiliency, SB 852 (Dodd) authorizes a city, county, city and county, special district, or a combination of any of those entities to form a climate resilience district to finance projects that address sea level rise, extreme heat, extreme cold, the risk of wildfire, drought, and the risk of flooding. This measure deems each district to be an enhanced infrastructure financing district that must follow existing law concerning enhanced infrastructure financing districts. This Bill could be beneficial to Pismo Beach as the City continues to work on creative ways to address sea level rise, coastal armoring, and similar topics.
Conclusion and Recommendation
Housing has continued to be a significant topic of legislation during the 2022 Legislative Session, with several the bills reducing local control in the review and processing of housing applications. Of particular importance to Pismo Beach are Assembly Bill 2011 and Senate Bill 6, which aim to require cities to allow housing on properties zoned for commercial uses. It is anticipated that educational workshops on the implementation will occur before these Bills go into effect on July 1, 2023.
Staff recommends that the Council provide direction to develop ordinances to appropriately implement AB 2011 and SB 6 in the city.
FISCAL IMPACT:
There is no fiscal impact associated with this report. Implementation of ordinances pursuant to the Council’s direction could have future fiscal impacts, which would be analyzed at the time the ordinances were considered by the Council.
ALTERNATIVES:
1. Provide alternative direction to staff.
ATTACHMENTS:
None.
Submitted by: Meeting Date: December 20, 2022
Matthew Downing, Community Development Director
City Manager Approval:
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