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How Will SB 9 Affect Planning in California?

William Fulton on
Sep 18, 2021

SB 9, the bill outlawing single-family zoning in California, is now law. On the surface, it’s a transformational piece of legislation, unwinding a century of California land-use regulation. But what’s really in it? And will it really result in either far more housing, as its proponents hope, or dramatically changed neighborhoods, as its opponents fear?

Neither question is easy to answer at this point. So let’s take a look at SB 9 – first, by examining what it does; and second, by speculating on what it’s impact will be.

What SB 9 Does

Let’s begin by running down what SB 9 does and doesn’t do.

First and most important, it mandates ministerial approval of duplexes on lots zoned for a single-family residence. So, with a resounding thud, yes, it ends single-family zoning in California.

Second, it also requires ministerial approval of subdivision of residential parcels into two parcels. So it creates the theoretical possibility for four units to be built on what is today a single-family parcel. However, subdivision is only possible in urban locations and cannot occur in a wide variety of circumstances, including farmland and wetlands, fire hazard zones, flootplains, species habitats, or historic districts.

There’s been considerable concern that SB 9 will benefit real estate investors and speculators but not people who need housing. So the Legislature imposed several residency requirements, including:

  • One of the resulting units must be occupied by an owner for the first three years (but no additional occupancy requirements can be added).
  • Local governments must adopt an ordinance prohibiting short-term occupancy, thus eliminating the AirBNB problem.
  • No deed-restricted units can be destroyed, nor can a rental unit that has been occupied by a tenant for the last three years.
  • An accessory dwelling unit cannot be added to the number of units constructed as a result of the bill.
  • Double-dipping is not allowed. That is, if a lot has already been split, it can’t be split again.

The Legislature has apparently learned from the battles over accessory dwelling units and other reforms where cities have fought back against state mandates with additional rules that made ADU construction more difficult. Longtime California planners will recall that the state and local governments engaged in a long-running battle over ADUs, with the locals consistently imposing more restrictions on ADUs (parking, minimum lot size, minimum unit size, etc.) and the state gradually pushing back. Finally, in 2017, the state passed an ADU law giving local governments little discretion and the number of ADUs permitted increased dramatically.

In this case, the state appears to be trying to clamp down from the beginning, with a variety of restrictions including the following:

  • Parking is limited to one space per unit in most circumstances.
  • Parking requirements are prohibited if the parcels are located within a half-mile of good transit service or within one block of a carshare service.
  • The two lots are about equal size.
  • Local governments cannot impose standards that would either make it physically impossible to build two units or that would create a minimum unit size of less than 800 square feet.

Local governments can’t stop the duplexes or lot splits, but they do have two major powers under SB 9:

First, they can impose “objective design standards” that don’t conflict with the law.

And second, they can deny a project if it would create a “specific, adverse impact on health and safety” and there is no way to mitigate that impact.

It’s likely that the locals will use these two powers in creative ways that will lead to extensive litigation. In fact, courts have been cracking down on creative use of these exact same standards in recent litigation over SB 35 and the Housing Accountability Act. Cities from Los Altos to Huntington Beach have run into trouble by trying to impose design standards that courts have found to be subjective, not objective. Most recently, an appellate court hammered the City of San Mateo for the same general approach. So cities will have to come up with very tight, objective standards that can be measured against if they seek to box duplexes and urban lot splits in this way.

Furthermore, as the cities in the SB 35 and Accountability Act cases are finding, these two powers are related. It’s possible to deny a project because of a health or safety impact – but that impact has to be specific and unmitigatible, and usually a safety impact in particular (such as, for example, egress) has to violate a specific objective standard. In the Huntington Beach case, the city found that the condo project being denied would create a safety hazard because cars would turn right out of the parking garage, make a U-turn, and possible cause collisions. The court reprimanded the city for being vague about this impact, however.

What Will SB 9’s Impact Be? 

The big question is how often SB 9 will actually be used by property owners. And that’s almost impossible to say.

The Terner Center for Housing Innovation at UC Berkeley tried to estimate how many parcels could feasibly be converted under SB 9. Their conclusion was: about 7% statewide.

Statewide, that translates into something like the following numbers:

  • There are about 7 million single-family parcels statewide.
  • Of those, about 6 million would be eligible for conversion under SB 9
  • About 410,000 parcels could be converted in a way that is feasible in the current market.
  • These parcels could yield about 714,000 additional units.

But that’s assuming that every parcel that could be converted is converted. Single-family homes are largely in the hands of homeowners themselves (though an increasing number are owned by investors large and small), and those homeowners are likely to take action based on their own personal circumstances, not the likelihood of market return.

On top of that, there’s the question – which we posed in a podcast with the Terner Center a few months ago – of who will build and finance these units. The ADU industry stood up pretty fast in California after 2017. But it’s a lot easier to plop an ADU in somebody’s back yard than it is to build a duplex – or two duplexes. It’s unclear whether a duplex industry can stand up as quickly as the ADU industry.

The bottom line probably looks something like this: Will SB 9 yield thousands of units? Probably. Will it yield tens or hundreds of thousands of units? Probably not.

The bigger question, really, is what the impact of all the state’s housing laws over the past few years will have on housing production. Like SB 35, the ADU law, SB 330, and others, SB 9 is not going to solve the housing market all by itself. As our Josh Stephens reported not long ago, SB 9 (and its companion bill SB 10) may not be as big a deal as the overall shift driven by the dramatic increase in the Regional Housing Needs Assessment numbers. In the end, Josh noted, RHNA may be more important. (Josh’s blog on this topic, which is in front of our paywall, is the most popular piece we’ve published this year and well worth reading.)