Developers rejoice: Newest state law aims to boost housing production

Known as the Housing Crisis Act of 2019, it would effectively increase the number of allowable units in a development and speed up construction timeline

Oct.October 09, 2019 03:48 PM
Governor Gavin Newsom and Senator Nancy Skinner (Credit: Getty Images and iStock)
Gov. Gavin Newsom and state Sen. Nancy Skinner (Credit: Getty Images and iStock)

Developers should now find it faster and less expensive to build housing across the state.

That’s after Gov. Gavin Newsom on Wednesday signed into law Senate Bill 330 — known as the Housing Crisis Act of 2019 — which prevents certain municipal policies that discourage development. The bill takes effect on Jan. 1 and expires in 2025.

It comes a day after Newsom signed into law the state’s landmark rent control legislation.

SB 330 imposes a ban on raising housing fees, increasing or enforcing parking minimums, or enacting new design standards. It also establishes a 12-month timeline for processing all housing permits, and caps the number of public hearings related to a new housing development.

Authored by state Sen. Nancy Skinner, the bill would effectively boost the number of allowable units in a development and speed up construction timeline. It prohibits local governments from passing other regulations that restricts the development of moderate- and low-income housing or emergency shelters, unless that city can prove the need to do so.

Cities will also be required to allow housing developments that meet existing zoning rules. Skinner argued that some wealthy California cities use strict zoning to block development and are not doing their share to address the state’s housing crisis.

SB 330 requires developers to replace any restricted affordable or rent-controlled units demolished as part of redevelopment. Developers will also be required to pay rehousing fees and give those tenants preference to return at the same rent they had previously been paying.

Some landlords and developers contend that high development costs force them to rent out units at higher rates. In theory, reducing development costs will allow developers to rent for less, industry pros say.

The measure comes at a time when the state housing authority has said Southern California needs to rezone to allow for 1.3 million new housing units in the next decade, and is three times what local governments had previously suggested they needed.

L.A. County alone is short around half a million units affordable to households considered “low-income,” or making between $58,000-$83,000 annually. Around 58 percent of L.A. County renters in that category spend more than a third of their income on rent.

SB 330 calls for a minimum $10,000 fine per unit for local agencies that reject an affordable housing development that otherwise meets zoning. The new law supplements other state-level initiatives to boost housing production.

At Wednesday’s bill-signing, Newsom also signed Assembly Bill 68, which is designed to streamline the process of permitting accessory dwelling units, or so-called granny flats.

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